Monday

26th Feb 2018

Germany to bring gold reserves back home

  • Thirteen percent of German gold is in London (Photo: bankofengland.co.uk)

Germany, the world's second largest holder of gold reserves after the US, on Wednesday (16 January) decided to repatriate part of its gold bars stored in New York and all of those kept in Paris by 2020.

"The German Bundesbank from 2020 on will store half of the German gold reserves in its own vaults inside the country. The other half will stay with partner central banks in New York and London," the Bundesbank said in a press release.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

Currently, the Frankfurt-based central bank only holds 31 percent of the more than 3,391 tonnes of gold which Germany owns, worth €137.5 billion. The rest is stored in New York (45%), London (13%) and Paris (11%).

The Bundesbank made clear that the move from Paris is not some kind of snub, but is instead linked to the fact that both countries have the same currency, the euro, so that the main reason for storing gold abroad - quick access to a foreign currency in case of crisis - is no longer valid.

The transport of 300 tonnes of the precious metal from New York and 374 tonnes from Paris will be done "gradually," with the Bundesbank keeping the dates of the shipments secret.

Its strategy to acquire gold abroad and store it there was developed during the Cold War, when West Germany feared possible invasion by the Russians. Before German reunification, 98 percent of its gold was in foreign vaults.

In choosing the locations abroad, the Bundesbank considers three criteria: central banks with the best international reputation, stable democratic structures in the host country and very high security standards.

Last October, when hurricane Sandy was rampaging along the US west coast, the Federal reserve was quick to say that its vault in New York, where Germany's and other countries' gold reserves are stored, is safe. "The bank's security arrangements are so trusted by depositors that few have ever asked to examine their gold," it noted.

The same month, he German court of auditors complained that many of the gold bars have never been checked by independent experts to see if they are genuine and to check how much they really weigh.

A member of the Bundesbank board, Carl-Ludwig Thiele, who presented the decision on Wednesday, told reporters the move is "independent" of the auditors' report.

"In Germany, a lot of emotion is attached to the topic of gold reserves. To hold gold as a central bank creates confidence," he said.

Baltic states demand bigger EU budget

The leaders of Estonia, Latvia, and Lithuania say in a joint letter that they are open to talks on creating "new own resources" for a bigger EU budget after the UK leaves the EU.

EU-Latin America trade talks move to 'endgame'

Senior negotiators in the EU-Mercosur talks will meet in Brussels on Friday to work out the technical bits of a possible trade deal, after top political officials gave the talks a final push.

EU in push to seal Latin American trade deal

In a race against the clock, EU commissioners and Mercosur ministers meet in Brussels to make concessions on beef, cheese and cars in preparation for an "endgame" in trade talks, ahead of Brazil's elections.

Opinion

Greek government's steady steps to exit bailout programme

Growth predictions are positive, exports increasing, unemployment dropping and credit-ratings up, says the head of Greece's Syriza delegation to the European Parliament. Now the government in Athens is looking to design its own reform programme.

Analysis

We are not (yet) one people

Talks on the next EU budget will start on Friday. Brussels wants to do much more than before – and needs a lot more money. But arguing about funds won't be enough.

News in Brief

  1. EU calls for immediate ceasefire in Syria
  2. UK's post-Brexit vision is 'pure illusion', Tusk says
  3. EU leaders express solidarity with Cyprus in Turkey drill row
  4. EU to double funding for Sahel forces
  5. EU parliament president: 'The immigration problem is Africa'
  6. May to unveil EU departure strategy next week
  7. Pregnant workers may be dismissed, EU court rules
  8. Romanian minister demands anti-corruption prosecutor fired

Stakeholders' Highlights

  1. ILGA EuropeAnkara Ban on LGBTI Events Continues as Turkish Courts Reject NGO Appeals
  2. Aid & Trade LondonJoin Thousands of Stakeholders of the Global Aid Industry at Aid & Trade London
  3. Macedonian Human Rights Movement Int.European Free Alliance Joins MHRMI to End the Anti-Macedonian Name Negotiations
  4. Mission of China to the EUChina-EU Tourism Year to Promote Business and Mutual Ties
  5. European Jewish CongressAt “An End to Antisemitism!” Conference, Dr. Kantor Calls for Ambitious Solutions
  6. UNESDAA Year Ago UNESDA Members Pledged to Reduce Added Sugars in Soft Drinks by 10%
  7. International Partnership for Human RightsUzbekistan: Investigate Torture of Journalist
  8. CESICESI@Noon on ‘Digitalisation & Future of Work: Social Protection For All?’ - March 7
  9. UNICEFExecutive Director's Committment to Tackling Sexual Exploitation and Abuse of Children
  10. Nordic Council of MinistersState of the Nordic Region 2018: Facts, Figures and Rankings of the 74 Regions
  11. Mission of China to the EUDigital Economy Shaping China's Future, Over 30% of GDP
  12. Macedonian Human Rights Movement Int.Suing the Governments of Macedonia and Greece for Changing Macedonia's Name

Latest News

  1. EU agrees budget to focus on defence, security and migration
  2. EU leaders nix transnational lists, cool on 'Spitzenkandidat'
  3. Regions chief: calls for smaller EU budget are 'impossible'
  4. Election fever picks up This WEEK
  5. EU-Morocco fishing deal casts doubt on EU future foreign policy
  6. EU leaders put 'Spitzenkandidat' on summit menu
  7. European far-right political party risks collapse
  8. The key budget issues on EU leaders' table