GERMANY’S central bank, the Bundesbank, yesterday bowed to public pressure by agreeing to withdraw 674 tonnes of gold reserves stored at foreign banks by 2020.
It will bring back 300 tonnes held in New York, and 374 tonnes currently stored in Paris, to leave roughly half of its total stock of 3,396 tonnes in Frankfurt. Currently it holds just 31 per cent of its reserves there. The bank said it no longer needed to hold reserves at the Banque du France, since they are both members of the euro.
But it will still keep significant portions at the Federal Reserve and Bank of England for trading and liquidity purposes.
At current prices, this is a transfer of gold worth about €27.4bn (£22.8bn), from total holdings worth roughly £115bn – holdings which place Germany second only to the US by the size of its gold pile.
The Bundesbank last year came under public pressure to inspect or repatriate reserves after the Federal Court of Auditors revealed that they had never fully been checked. Germany started building up its hoard of the yellow metal in 1951, but held 98 per cent of its giant stock abroad during the Cold War, for security reasons. But these reasons no longer held, Bundesbank board members said yesterday.