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Is Central Bank Lending a Transparent Function in the Gold Market?
Q & A section with Jan Lamers of the Netherlands Central Bank at the London Bullion Market Assoc. Conference 2002
“Jan, on the topic of transparency, you indicated that you were not happy with the transparency of the market. The LBMA has been very keen to create more information over the years. What other information would you like to see in the public domain?
When I said I was not happy, I may have been too strong; I was just discussing what I see. As a central banker, you very often hear that something is going on in the market and certain names are mentioned, but whenever they speak to you they do not know anything, or they do not want to share the information. This may be for very obvious reasons because it is a small market.
Jan, how many central banks have cut back their lending in the last year?
They do not tell me. Perhaps you should invite some other central banks to speak up here next year.”
LBMA Conference 2002
Jan Lamers, Financial Markets Department
De Nederlandsche Bank
Even the Bank for International Settlements (The Central Bank for all central banks) does not have a clear picture of the gold lending market, which by their own admission, is one dominated by Central Bank activity.
“The second way central banks can have an influence on gold is through the lending of some of their gold in the lease market. Central banks have expanded their leasing activities over the recent years, seeking an improvement in the return on their holdings. Actually, central banks are the dominant players in this relatively narrow market. The size of this market is very difficult to evaluate. Around the year 2000, most market participants mentioned the figure 5,000-5,500 tonnes.”
LBMA Conference 2004
Jean-François Rigaudy
Head of Treasury, Bank for International Settlements
http://www.lbma.org.uk/conf2002/3Bc.lamersLBMA2002.pdf
http://www.lbma.org.uk/conf2004/2b.rigaudy_LBMAConf2004.pdf
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