Italy is considering declaring that the 2,452 tons of gold held by its central bank belongs to the people, a move opposed by the European Central Bank over concerns it could threaten the bank’s independence. While the Italian central bank is unlikely to be forced to sell, central banks in Brazil and Poland have shown a strong appetite for gold, with October purchases reaching 53 tons, notes Carsten Fritsch, commodities analyst at Commerzbank.
The European Central Bank urges the Meloni government to rethink the proposal
“Italy appears to be considering declaring that the gold reserves held by the central bank belong to the people. The European Central Bank has called on Prime Minister Meloni’s government to reconsider this proposal. There are clearly concerns that the central bank may be forced by the government, as the elected representative of the people, to sell gold.”
“This in turn could undermine the independence of the central bank, which is guaranteed by the statute of the European Central Bank. The Italian central bank holds 2,452 tons of gold in its vaults, making it the third largest gold reserve after the US Federal Reserve and the German Bundesbank. It is unlikely that the government will actually force the Italian central bank to sell gold.”
“If that happens, you will have no difficulty finding grateful buyers among other central banks. As the World Gold Council reported, central bank gold purchases rose to 53 tons in October, reaching their highest monthly level this year. The biggest buyers in October were the central banks of Brazil with 16 tons and Poland with 15.6 tons.”
