Home News Germany brings home more gold: Bundesbank

Germany brings home more gold: Bundesbank

Published on January 27, 2016

The German central bank, or Bundesbank, said Wednesday that it brought home last year more of its gold reserves from overseas storage.

“The Bundesbank successfully continued its transfers of gold last year,” the central bank said in a statement.

“In 2015, 210 tonnes of gold were transferred to Frankfurt from storage locations abroad: around 110 tonnes from Paris and just under 100 tonnes from New York.”

Germany’s gold reserves are the second-biggest in the world after those of the United States and totalled 3,381 tonnes this month, according to the latest data compiled by the World Gold Council.

For decades the Bundesbank’s gold holdings have been kept in the treasuries of other central banks — in Paris, London and New York.

According to the German central bank’s own data, 1,347.4 tonnes are stored at the Federal Reserve Bank in New York, 434.7 tonnes at the Bank of England in London and 196.4 tonnes at the Banque de France in Paris.

There were historical reasons for this.

After World War II and the export revival of West Germany’s “economic miracle” in the 1950s, the central bank accumulated dollars it swapped for gold at the Federal Reserve. With Germany split between capitalist west and the communist East German state until 1990, storing most of the gold abroad was a way to keep it out of Soviet reach during the Cold War.

But surging mistrust of the euro during Europe’s debt crisis fed a campaign to bring home Germany’s gold reserve from New York and London, with some political parties fuelling fears the gold might have been tampered with.

Under the Bundesbank’s new gold storage plan in 2013, it decided to bring back 674 tonnes from abroad by 2020 and store half of its gold in its own vaults.

As a result of the ongoing transfers, Frankfurt has become the biggest gold storage location, housing 1,402.5 tonnes.

“With approximately 1,403 tonnes of gold, Frankfurt has been our largest storage location, ahead of New York, since the end of last year,” said executive board member Carl-Ludwig Thiele.

“The transfers are proceeding smoothly. We have succeeded in once again significantly increasing the transport volume compared with 2014. This means that operations are running very much according to schedule,” Thiele added.

Since the transfers began in 2013, the Bundesbank said it has relocated a total of 366.3 tonnes of gold to Frankfurt — 177.3 tonnes from Paris and 189 tonnes from New York.