For six months between March and August, the Dutch central bank quietly shifted 86 tons of gold out of New York and Ottawa to London, saying the move made it \u201cbetter prepared for serious crises.\u201d <\/p>\n
Confirming the action yesterday, De Nederlandsche Bank (DNB) stated<\/a> that the decision had been made \u201cdue to the increasing geopolitical unrest\u201d and therefore wanted to improve the \u201ctradability\u201d of Dutch gold.<\/p>\n \u201cGold stored in London at the Bank of England \u2026 is considered the most easily tradable gold in the world,\u201d wrote DNB. \u201cThis makes it the fastest way for DNB to deploy in a crisis situation. The part of the gold stock located in New York and Ottawa is less directly deployable.\u201d<\/p>\n DNB hasn\u2019t reallocated all of its North American gold reserves\u2014of the 612 tons it holds in total, 18.5% remains in New York and Ottawa.<\/p>\n But the situation wasn\u2019t lost on economists in the current climate, in which a series of actions by the U.S. Treasury has\u2014intentionally or not\u2014drawn attention to the increasing risk premiums in the Treasury market.<\/p>\n As UBS\u2019s Paul Donovan remarked this morning: \u201cOne reason U.S. Treasury Secretary Scott Bessent was reported to have intervened in the support of the yen in the past was the desire to prevent Japanese investors rushing for the exit of the U.S. Treasury bond market. While this was going on, the central bank of the Netherlands was apparently rushing to the exit of the New York Federal Reserve with as much gold as it could carry stuffed into its pockets.\u201d<\/p>\n The move to improve liquidity of gold is \u201cnot normal behavior,\u201d added Donovan, continuing: \u201cThe direct market impact is nil, the gold is still held as gold, and gold held in London is traded in dollars, so there\u2019s no change in the foreign exchange markets directly.<\/p>\n \u201cBut, even allowing for the fact that central banks\u2019 gold holdings tend to represent some of the most conservative and risk-averse decisions one can find anywhere, the signals around trust and the international reputation of the United States are quite dramatic.\u201d<\/p>\n Risk profile<\/p>\n In March, the Banque de France\u2014France\u2019s central bank\u2014also announced<\/a> it had sold 129 tons (or 5% of its total gold holdings) in New York and had instead purchased gold in Europe. DNB followed a similar path, selling the majority of its U.S. gold and repurchasing it closer to home, rather than physically moving it.<\/p>\n While the French central bank did not make any suggestion that its 2025 decision was owing to geopolitical risk and liquidity (rather, it referenced wanting to bring the purity of its gold holdings to over 99.99%, and the U.S. stock was below that), any suggestion that hackles are raised over the risk profile of the U.S. is unhelpful to the nation\u2019s borrowing.<\/p>\n While the Treasury secretary said that his intervention into the Japanese yen last month was to help stabilize financial stability<\/a> and trade in Asia, it also conveniently steadied the economy of one of its largest lenders. Bessent then announced<\/a> a series of Treasury bond buybacks, which lowered elevated yields and eased financial conditions across the wider economy.<\/p>\n With U.S. national debt surpassing the $40 trillion mark<\/a> a few weeks ago, questions about the country\u2019s fiscal trajectory <\/a>continue to mount. While there are no signs of a much-debated bond market \u201creckoning\u201d at the moment, international banks moving their safest asset out of the U.S. raises questions about its longtime safe harbor status.<\/p>\n Fortune Daily breaks the traditional barrier between audience and newsroom. The show transforms Fortune\u2019s trusted reporting into actionable, conversational, and entertaining insights for an emerging class of business leaders. Watch here.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"For six months between March and August, the Dutch central bank quietly shifted 86 tons of gold out…\n","protected":false},"author":2,"featured_media":337458,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[57666,18800,1621,9,11,10,16371,126743],"class_list":["post-337457","post","type-post","status-publish","format-standard","has-post-thumbnail","category-new-york","tag-assets","tag-bonds","tag-gold","tag-new-york","tag-new-york-headlines","tag-new-york-news","tag-scott-bessent","tag-u-s-department-of-the-treasury"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/337457","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=337457"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/337457\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/337458"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=337457"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=337457"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=337457"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}