Germany to G20: German Gold “Must Remain Off Limits”; Italian Gold Sale Again Proposed In Germany
Gold is trading at USD 1,767.90, EUR 1,283.90, GBP 1,101.60, JPY 138,011, CHF 1,583.90, and AUD 1,711.70 per ounce.
Gold’s London AM fix this morning was USD 1,764.00, GBP 1,102.78, and EUR 1,286.65 per ounce.
Friday’s AM fix was USD 1,756.00, GBP 1,096.47, and EUR 1,269.61 per ounce.
Gold prices have risen in all major currencies due to safe haven
demand for bullion on concerns that the debt crisis in Greece, Italy and
much of the Eurozone may lead to contagion in markets.
Italian 10 yr government bond yields have surged to 6.61% and saw an
inter day high of 6.676% which has contributed to sell offs in European
stock indices which followed their Asian counterparts lower.
The ‘safe haven’ Swiss franc has fallen sharply against all
currencies including the euro and especially against gold. Gold in Swiss
francs has surged 2.4% – from CHF 1,556 to 1,590.
Germany has rejected proposals by France, Britain and the US to have
German gold reserves used as collateral for the Eurozone bailout fund.
Germany Economy Minister Philipp Roesler said on Monday that the
German people’s gold reserves cannot be touched and “must remain off
“German gold reserves must remain untouchable,” said Roesler, who is
head of the Free Democrats (FDP), a partner in Chancellor Angela
Roesler added his voice to opposition to an idea proposed at the G20
summit of using reserves including gold as collateral for the euro zone
The Bundesbank and Mr. Seibert, spokesman for Merkel, said Sunday
that they too ruled out the idea discussed at the summit of Group of 20
leading economies last week.
Mr. Seibert dismissed media reports yesterday that the plan to boost
bailout funds, to aid Italy or another large euro zone country, would
require Germany to sell off part of its gold and foreign exchange
“Germany’s gold and foreign exchange reserves, administered by the
Bundesbank, were not at any point up for discussion at the G20 summit in
Cannes,” he said.
Mr. Seibert was responding to proposals to sell about €15 billion of
Germany’s gold reserves of over 3,000 metric tonnes, worth a reported
A Bundesbank spokesperson said it was aware of the plan and said the institution “rejected” plans to touch federal reserves.
The Sunday Frankfurter Allgemeine newspaper said the
initiative marked a fresh round in an ongoing struggle between the
Bundesbank and the Merkel administration over reserves the bank manages
on behalf of the German people.
The Irish Times reports that today’s finance ministers’ discussion is part of a wider strategy by the ECB to sound out the possibility of gaining control over the gold reserves of the euro zone’s central banks.
Italian Gold Sale Again Proposed in Germany
Senior German politician, Gunther Krichbaum, a lawmaker in
German Chancellor Angela Merkel’s governing coalition and Chairman of
the Committee on the Affairs of the European Union of the German
Bundestag has proposed that Italy sell its sizeable gold reserves in
order to lower its debt.
Krichbaum, who chairs the German parliament’s European Affairs
Committee, was quoted as saying in the Rheinische Post that Italy’s gold
reserves are relatively high and could be used to pay off their
Using periphery nations’ gold reserves as collateral has been on the
agenda in Germany for some months with many influential German
politicians calling for debtor Eurozone nations to sell their gold
Angela Merkel’s budget speaker and his opposition counterpart urged
Portugal to consider selling their gold in May of this year.
Senior Minister and rival to Merkel, Ursula von der Leyen, demanded
that the debtor ‘PIIGS’ countries offer Germany more reliable guarantees
and allow it access to their gold reserves and industrial facilities as
payment for loans.
Gold’s value as money and as a strategically important monetary asset is being slowly realized again.
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Silver is trading at $34.45/oz, €25.05/oz and £21.46/oz
PLATINUM GROUP METALS
Platinum is trading at $1,630.25/oz, palladium at $654.75/oz and rhodium at $1,525/oz.
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