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Showing posts with label Turkey. Show all posts
Showing posts with label Turkey. Show all posts

Monday, 14 May 2018

Reserve Bank of India adds 2.5 tonnes of gold to forex reserves in Q4

This was the first instance of gold being added to the forex reserves since 2009

The Reserve Bank of India (RBI) has added 2.5 tonnes of gold to foreign exchange reserves for the quarter ended March 2018 in two tranches.

This is the first such addition after 2009, when the central bank bought 200 tonnes of the yellow metal from the International Monetary Fund (IMF) at $1,032 per tonne. According to IMF data (updated till March 2018), India’s gold holding in forex reserves rose to 560.3 tonnes by the end of March 2018. The RBI did not respond to email queries till the time of going to press.“The addition looks like a pilot purchase. The net impact is that reserves are up marginally. This is not significant and does not imply strategic addition, unless we see a creeping acquisition trend,” a source said. “This was a decision taken by the government before the Budget presentation. But due to the sensitivity of the issue, it was not announced,” another source added. Globally, central banks, including in Russia and Turkey, add gold to forex reserves to hedge against the dollar. The Turkish central bank announced a policy in May 2017, replacing the dollar as a prominent asset in its foreign exchange reserves. Turkey’s commercial banks also hold huge gold deposits.



These are placed with the central bank under the reserve option mechanism. The country is the 11th largest gold-holding country in forex reserves at 595.5 tonnes. Russia has been buying over 200 tonnes of gold per year since the last three years to add to its forex reserves and reduce dollar dependence. Its reserves are bigger than China’s, making them the sixth largest in the world. Russia and China buy most of their gold locally since they are prominent gold miners.

According to sources, India could add gold mobilised by the Gold Monetising Scheme to its forex reserves. The RBI was likely to have purchased gold in March from two London-based banks, they added. Gold buying by central banks has been on the rise in the last few years, with 350 to 400 tonnes of gold being bought annually. China buys gold locally, but announces with a lag. However, according to GFMS Thomson Reuters, China will buy gold this year to add to its reserves after two years.


Source : http://www.business-standard.com/article/finance/reserve-bank-of-india-adds-another-3-1-tons-of-gold-to-forex-reserves-118051000349_1.html

Wednesday, 20 July 2016

Gold prices to go up: RSBL

                                                                 - Mr. Prithviraj Kothari, MD RSBL




While financial uncertainties were influencing gold prices, we have lately seen geo political uncertainties giving the yellow metal's safe haven appeal a further support if not permanent a temporary one.  The failed military coup in Turkey did manage to shake the markets.

Spot gold prices turned higher, reversing earlier losses in late trade on Friday in New York after Turkish Prime Minister Binali Yildirim said a group within the country's military has attempted to overthrow the government. For several hours overnight on Friday violence shook Turkey's two main cities, as the armed faction which tried to seize power blocked a bridge in Istanbul and strafed the headquarters of Turkish intelligence and parliament in Ankara. But the coup attempt crumbled as Erdogan rushed back to Istanbul from a Mediterranean holiday and urged people to take to the streets to support his government against plotters he accused of trying to kill him. The government declared the situation under control, saying 2,839 people had been rounded up, from foot soldiers to senior officers, including those who formed "the backbone" of the rebellion.

Earlier on Thursday, spot gold price crashed down to a two-week low of $1,320.45 after the Bank of England’s (BOE), contrary to expectations, kept interest rates unchanged in its Thursday meeting. In a somewhat surprising move, the Bank of England (BoE) decided to keep rates steady despite fear over the health of the UK economy following the Brexit vote.

Holdings in Global Gold ETF’s rose on Friday but lost about 10 tons in total over the week to 2002 tons, which was the biggest decline since March/April this year.

Gold continues to trade range bound between USD $1,320 - $1,340, however participants are still looking to play on the long side and we are likely to see moves lower well supported.

I largely see the spot gold price supported at the $1,300 level due to a post-Brexit global economic uncertainty and possibly lower US interest rates and given this critical situation at Turkey, precious metals prices are expected to move higher as they have always been influenced by geopolitical uncertainties.

Thank You!


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The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.

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