India’s Central Bank Denies It’s Selling/Trading India’s Gold
Just like the Fed isn’t engaged in QE?
(Silver Doctors Editors) A couple of days ago, the RBI said this:
Reports have appeared in certain sections of media that RBI has been selling/ trading in gold of late. It is clarified that RBI has not sold any gold or trading in it. (1/1)
— ReserveBankOfIndia (@RBI) October 27, 2019
Kudos for not being afraid to use the 4-letter word.
Why did the RBI make that statement?
Because of monetary value fluctuations in India’s gold reserves.
From Bloomberg:
The Economic Times had reported on Friday that the Reserve Bank of India started trading in gold actively since July, buying gold worth $5.1 billion and selling $1.15 billion worth. The newspaper cited data from the RBI’s Weekly Statistical Supplement.
The RBI further clarifies:
The fluctuation in value depicted in Weekly Statistical Supplement (WSS) is due to change in frequency of revaluation from monthly to weekly basis and is based on international prices of gold and exchange rates. (2/2)
— ReserveBankOfIndia (@RBI) October 27, 2019
At least superficially, the RBI’s explanation passes the smell test.
Interestingly, the Reserve Bank of India keeps gold on its books valued at a floating market rate.
The US Treasury and the Fed keep US gold valued on the books at a fixed rate of $42.2222 per ounce.
What would happen if the US valued the gold on our books at a market rate?
Or at $10,000 per ounce?
Or $100,000?
Keith Weiner explored such a topic during our interview last week:
