Central banks 'withdrawing large amounts of BIS gold'

8 July 2011

A considerable amount of gold has been pulled by central banks from the Bank for International Settlements (BIS) in the last 12 months.

According to the BIS's annual report, 635 tonnes of the commodity was withdrawn in this period - the most for more than a decade, the Financial Times reports.

The pattern goes against the trend last year, which saw lenders contributing gold to a 'bank for central banks', as opposed to lending it straight to the private sector.

Currently, most central banks and other institutions hold around 30,000 tonnes of bullion in their reserves, despite demand to borrow gold having dipped over the past ten years.

One banker told the newspaper: "My perception is there's less and less gold being put out by the central banks into the gold market."

The BIS, having been established in May 1930, is the oldest financial institution in the world - and has its head office based in Basel, Switzerland.

By Asim Shah

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