Bundesbank hoards more gold

Germany's business daily "Handelsblatt" reported on Tuesday the Bundesbank was planning to bring home some of its gold reserves that were currently stored abroad. The German central bank's concept entailed upgrading the domestic storage facility in Frankfurt, the newspaper claimed.

All in all, the Bundesbank oversees gold reserves to the tune of 133 billion euros ($177.5 billion), but only 31 percent are currently deposited at Frankfurt, with the rest spread between facilities of the US Fed, the Bank of England and the Banque de France.

According to the "Handelsblatt", the Bundesbank is to withdraw part of its reserves from the Fed, while leaving no bullions at all in France.

New political realities

The idea of depositing gold reserves at various facilities abroad goes back to the cold-war era when it was considered safer not to hoard all bullions at home in Frankfurt.

But the German central bank's move to bring home part of its gold reserves is not only a result of cold-war threats being a thing of the past.

First and foremost, the Bundesbank is reacting to a recent report by the Federal Audit Office which has criticised the lender of failing to thoroughly check the amount and genuineness of the bullions stored abroad.

While such checks would still be needed in the future, the Bundesbank would have more of ist reserves under ist direct control by bringing home some of ist stockpiles. The central bank is to disclose more details of its plan on Wednesday.

hg/rg   (dapd, AFP)