Gold Central Banks Agreement

The agreement of central banks on gold was first signed on September 26, 1999 in Washington at the annual meeting of the International Monetary Fund (IMF) . For this reason, this agreement is sometimes called the “Washington Agreement”, but with the same success it can be called the “European Agreement”, since it exclusively involves European central banks ^[1] .

In accordance with the agreement, which was signed by the European Central Bank (ECB) and 11 national central banks of the countries participating in the creation of the new European currency Euro , plus the central banks of Sweden, Switzerland and the United Kingdom, agreed that gold should remain an important element of global foreign exchange reserves and limit its sales to no more than 400 tons (12.9 million ounces) annually starting from September 1999, and no more than 2000 tons (64.5 million ounces) in the next 5 years until September 2004 ^[1] .

The reason for the agreement was the threat of possible destabilization of gold prices after the UK Treasury announced plans to sell 58% of British gold reserves through Bank of England auctions, as well as prospects for significant sales of gold by the Swiss National Bank and possible current sales by Austria and the Netherlands, plus IMF sales offers. Unlike many European countries that reported their gold sales after the events, the decision of the UK Treasury to sell was announced in advance, causing the greatest concern ^[1] .

Signatories:

The second gold agreement of the central banks was signed on March 8, 2004 and entered into force on September 27, 2004. According to this agreement, the annual gold sales for each country should not exceed 500 tons per year, and not more than 2500 tons over the next 5 years. The Bank of England refused to participate in the agreement, but the Bank of Greece joined.

In August 2009, 19 central banks signed a third gold agreement. The total annual sales of gold was limited to 400 tons and was valid until September 2014. The IMF has not signed this agreement.

On May 19, 2014, the European Central Bank and 20 other Central Banks of Europe announced the signing of the fourth interbank gold agreement. This agreement, which will enter into force on September 27, 2014, will be valid for five years. Banks participating in the agreement undertake not to sell large volumes of gold ^[2] .

As a result, the following statement was signed and published ^[3] :

European Central Bank, National Bank of Belgium, German Federal Bank, Bank of Estonia, Central Bank of Ireland, Bank of Greece, Bank of Spain, Bank of France, Bank of Italy, Central Bank of Cyprus, Bank of Latvia, Central Bank of Luxembourg, Central Bank of Malta, Bank of the Netherlands, National Bank of Austria, Bank of Portugal, Bank of Slovenia, People's Bank of Slovakia, Bank of Finland, National Bank of Sweden and Swiss National Bank today announce the fourth Central Banks Gold Agreement (STBZ).

In the interest of ascertaining intentions regarding their gold holdings, the signatories of the fourth SPBZ publish the following statement:

• gold remains an important element of global foreign exchange reserves;
• Signatories will continue to coordinate their gold deals to avoid market shocks;
• signatories note that they currently have no plans to sell significant amounts of gold;
• this agreement, which will enter into force on September 27, 2014 after the expiration of the current agreement, will be reviewed in five years.

• gold standard
• List of central banks