In 2009, almost all central banks showed an increased love for gold. In the recent past, Russia’s central bank addded 800,000 ounces of gold to its reserves last month, increasing its holdings of the metal to $22.4 billion.
The bank’s gold reserves climbed to 20.5 million ounces from 19.7 million the previous month. And, India’s central bank also purchased gold in 2009 to increase its foreign reserves.
With the Reserve Bank of India (RBI) purchasing 200 tonne gold in two phases from the International Monetary Fund (IMF) in November 2009, the central bank’s gold holdings have increased from 357.75 to 557.75 tonne.
RBI held about 357.75 tonne, forming about 3.7% of the total foreign exchange reserves in value terms as at the end of September 2009. Out of this, 65.49 tonne is being held abroad since 1991 in deposits or safe custody with the Bank of England and the Bank for International Settlements.
Currently, RBI holds gold reserves worth $18.3 billion which is 6.33% of the country’s total forex reserve. Gold reserves held by India stood at $10.32 billion as on September 2009. Interestingly, India’s gold reserves have been rising steadily from $9.2 billion in May 2008 and touched $9.6 billion in May 2009, after falling to $8.57 billion in September 2008.
The country’s total foreign exchange reserves stood at $284.3 billion.
Talking about investment pattern for foreign currency assets which were worth $264.4 billion at the end of September 2009, RBI said $148 billion was invested in securities, $111.3 billion was deposited with other central banks, BIS and the IMF and $5.1 billion was parked in the form of deposits with foreign commercial banks placed with the external asset managers.
A small portion of the reserves has been assigned to the external asset managers (EAMs), with the main objective of gaining access to and deriving benefits from their expertise and market research.
The rate of earnings on foreign currency assets and gold, after accounting for depreciation, decreased from 4.82% in July 2007-June 2008 to 4.16% in July 2008-June 2009.
Showing posts with label Gold Reserves. Show all posts
Showing posts with label Gold Reserves. Show all posts
Friday, 22 January 2010
Sunday, 21 June 2009
IMF Gold Sale: WGC welcomes US approval
The World Gold Council (WGC), the apex global body on gold, has welcomed the US Congress approval to the gold sale plan from the International Monetary Fund (IMF).
Last week, the US House of Representatives approved an agreement to allow US members of the IMF board to agree the proposed $13 billion sale of 400 tonnes of IMF gold to shore up its finances.
In a statement, Aram Shishmanian, the WGC's chief executive welcomed the US Congress approval to the IMF gold sale plan. "We are pleased to see that the IMF's plan to sell gold in a structured and non-disruptive manner has gone through due political process without problem, which is a credit to the responsible behaviour of all parties involved in the process," said the statement.
WGC said the IMF gold sale will not constitute any net addition to the amount of gold the market is already expecting from official sector sources as a whole, and therefore we anticipate zero market impact. We believe this announcement, if anything, will lead to positive sentiment among market participants as it clarifies that there will be no net addition to overall gold supply.
Shishmanian said: "In these times of financial instability, gold's universal role as protector of wealth has come to the fore, not least as a crucial part of reserve asset portfolios. The fact that these sales will effectively rescue the IMF from a difficult situation regarding its own finances is proof of gold's unique investment characteristics, long-recognised by central bankers and institutional and retail investors alike."
Given the IMF's status as "a lender of last resort", the WGC believes it is imperative that the organisation continues to hold large gold reserves and acknowledges the IMF's public declarations that: "The IMF should continue to hold a relatively large amount of gold among its assets, not only for prudential reasons, but also to meet unforeseen contingencies."
The US approval to the IMF gold sale plan has been tied to the Military Supplemental Bill which covered additional funding for the Iraq and Afghanistan conflicts for the U.S forces.
While the bill itself does not specifically tie the IMF sales to an orderly sales programme, the IMF has stated publicly that any such sales should be made in co-ordination with current and future Central Bank Gold Sales Agreements whereby signatories have to agree to limit total annual sales to less than a specific volume (currently 500 tonnes).
Last week, the US House of Representatives approved an agreement to allow US members of the IMF board to agree the proposed $13 billion sale of 400 tonnes of IMF gold to shore up its finances.
In a statement, Aram Shishmanian, the WGC's chief executive welcomed the US Congress approval to the IMF gold sale plan. "We are pleased to see that the IMF's plan to sell gold in a structured and non-disruptive manner has gone through due political process without problem, which is a credit to the responsible behaviour of all parties involved in the process," said the statement.
WGC said the IMF gold sale will not constitute any net addition to the amount of gold the market is already expecting from official sector sources as a whole, and therefore we anticipate zero market impact. We believe this announcement, if anything, will lead to positive sentiment among market participants as it clarifies that there will be no net addition to overall gold supply.
Shishmanian said: "In these times of financial instability, gold's universal role as protector of wealth has come to the fore, not least as a crucial part of reserve asset portfolios. The fact that these sales will effectively rescue the IMF from a difficult situation regarding its own finances is proof of gold's unique investment characteristics, long-recognised by central bankers and institutional and retail investors alike."
Given the IMF's status as "a lender of last resort", the WGC believes it is imperative that the organisation continues to hold large gold reserves and acknowledges the IMF's public declarations that: "The IMF should continue to hold a relatively large amount of gold among its assets, not only for prudential reasons, but also to meet unforeseen contingencies."
The US approval to the IMF gold sale plan has been tied to the Military Supplemental Bill which covered additional funding for the Iraq and Afghanistan conflicts for the U.S forces.
While the bill itself does not specifically tie the IMF sales to an orderly sales programme, the IMF has stated publicly that any such sales should be made in co-ordination with current and future Central Bank Gold Sales Agreements whereby signatories have to agree to limit total annual sales to less than a specific volume (currently 500 tonnes).
Friday, 24 April 2009
Who holds the highest gold reserves?
China becoming the fifth biggest holder of gold reserves with 1054 tonnes and it has already hit the headlines on Friday leading to a marginal rise in gold prices in major trading centres.
The world leader in gold reserves is United States with 8133 tonnes as on September 2008 that accounts for 76.5% of its foreign exchange reserves. Germany has the second highest gold reserves at 3412.6 tonnes while IMF has 3217, France has 2508 tonnes constituting 58.7% of its forex assets.
Italy has 2451.8 tonnes constituting 61.9% of forex reserves followed by Switzerland at 1040 constituting 23.8% of total forex reserves.
India is way down at 14th position with gold reserves of 357.7 tonnes representing 3% of total forex reseres.
China Agency Xinhua reported that China’s additional gold acquistion represents an increase of 454 tonnes from 600 tonnes in 2003, the last time China announced an adjustment of its gold holdings. The country adjusted its holding of gold reserves twice this century. It raised its holding from 394 tonnes to 500 tonnes in 2001, and to 600 tonnes in 2003, Hu said.
The world leader in gold reserves is United States with 8133 tonnes as on September 2008 that accounts for 76.5% of its foreign exchange reserves. Germany has the second highest gold reserves at 3412.6 tonnes while IMF has 3217, France has 2508 tonnes constituting 58.7% of its forex assets.
Italy has 2451.8 tonnes constituting 61.9% of forex reserves followed by Switzerland at 1040 constituting 23.8% of total forex reserves.
India is way down at 14th position with gold reserves of 357.7 tonnes representing 3% of total forex reseres.
China Agency Xinhua reported that China’s additional gold acquistion represents an increase of 454 tonnes from 600 tonnes in 2003, the last time China announced an adjustment of its gold holdings. The country adjusted its holding of gold reserves twice this century. It raised its holding from 394 tonnes to 500 tonnes in 2001, and to 600 tonnes in 2003, Hu said.
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