Belgium Central Bank Looking At Repatriating Gold

(Kitco News) - The National Bank of Belgium is the latest central bank to show interest in repatriating its gold reserves.

In an interview with Belgium broadcaster VTM Nieuws Sunday, Luc Coene, governor of Belgium’s central bank, confirmed that the bank is looking at how they can bring their gold reserves back into the country.

Image courtesy of Banque nationale de Belgique: Luc Coene, governor of the National Bank of Belgium

According to IMF data compiled by the World Gold Council, Belgium holds 227.4 metric tons of gold, representing 34.2% of its official foreign reserves. According to reports, most of the gold is held outside of the country with the Bank of England, the Bank of Canada and the Bank for International Settlements.

Jeff Nichols, managing director of American Precious Metals Advisors and
senior economic advisor at Rosland Capital, said he is not expecting the news to have much impact on the gold price, but it could still seen as mildly positive for the market as central banks review their asset management.

He added that there is a shift in attitudes about how gold reserves should be managed and where it should be stored.

“This is a sign of things to come to define gold’s role in central banks’ monetary policy,” he said.

Axel Merk, president and chief investment officer of Merk Investments, said that global instability is on the rise, so is it not surprising governments and central banks want more control over their reserves.

However, he added that repatriating gold is not as simple as it sounds and in the global marketplace moving gold reserves is more than just transfer the metal from one location to the next. He said that neither central bankers or politicians know how to hand physical gold.

“It's not trivial to store gold safely - and places such as London have shown they have the experience to do so,” he said. “This shouldn't stop anyone from repatriating gold, but means that there's a learning curve.”

The topic of gold repatriation has heated up in recent weeks after Swiss citizens voted down a referendum, on Nov. 30, that would have seen the central bank increase its gold reserves by 20%, hold all its gold within the country and not be able to sell any of its gold reserves.

Just before the Swiss referendum, the Dutch central bank announced in mid-November that it had it repatriated 122.5 metric tons of gold, worth about $5 billion, back to Amsterdam from the U.S. On Nov. 25, France jumped on the gold bandwagon after political leader Marine Le Pen wrote an open letter to Christian Noyer, governor of the Bank of France, requesting that the country’s gold holdings be repatriated back to France.

http://www.kitco.com/news/2014-12-08/Belgium-Central-Bank-Looking-At-Repatriating-Gold.html