Bundesbank to Pull Gold from New York and Paris in Watershed Moment !
- Bundesbank to pull gold from New York and Paris in watershed moment!
by Ambrose Evans-Pritchard, http://www.telegraph.co.uk/
Germany’s Bundesbank is to repatriate gold reserves held abroad to tighten control and combat currency crises in the future, pulling a chunk of its holdings from New York and all its bullion from Paris.
The move marks an extraodinary breakdown in trust between leading central banks and has set off ferment among gold enthusiasts, with some comparing it with France’s withdrawal of gold from the US under President Charles de Gaulle as the Bretton Woods currency system crumbled in the early 1970s.
Handelsblatt said the Bundesbank will announce on Wednesday that it intends to relocate the gold to vaults in Frankfurt, said by insiders to include parts of the old archive library. Germany has 3,396 tons of gold worth roughly £115bn, the world’s second-largest holding after the US. Most of the reserves were stored abroad for safety during the Cold War.
The bank holds an estimated 45pc of its gold at the US Federal Reserve in New York, and 11pc at the Banque de France, lower than originally thought.
A report by Germany’s budget watchdog in October revealed that the bank halved its holding in London a decade ago, a period when the Bank of England was selling part of Britain’s gold at the bottom of the market to buy euros.
The gold was purportedly withdrawn because London was charging €500,000 a year in storage costs. The Bundesbank said part of 930 tonnes brought back was melted down for checks, and “not one gram was missing”. It currently holds just 13pc of its total holdings at the Bank of England.