Central Bank loses €75m on its gold deposits

The Central Bank last year recorded a paper loss of €75m on its gold deposits, new figures show.

Central Bank loses €75m on its gold deposits

According to Minister for Finance, Michael Noonan, the value of the Central Bank’s gold deposits was €168m at the end of last year — a decrease of €75m on the €243m put on the value of gold at the end of 2012.

Last year’s reversal more than wiped out two years of gains by the Central Bank in its gold holding — with its value increasing from €203.79m at the start of 2011 to €234.96m at the end of that year. The holding further increased to €243.5m in 2012.

The fall in the Central Bank’s holding followed the value of golf declining by a quarter to about $1,200 per ounce between January and December of last year

In his written Dáil reply to Fianna Fáil’s Michael McGrath, Minister Noonan said: “Gold and gold receivables consist of coin stocks held in the Central Bank, together with gold bars held at the Bank of England.”

Mr Noonan confirmed the Central Bank has not sold or purchased gold in the periods 2010 to 2013.

He said: “The movement in the holdings of gold is reflective of the change in value/price of gold.”

The price of gold has been on a downward trajectory since its peak in August 2011, after 10 years of virtually uninterrupted growth.

The reduction of the value of gold has meant not only bad news for the Irish Central Bank, but central banks around the world where the value of gold holdings slumped last year to $1.28tr, compared with $1.7tr at the start of 2013.

Separately, in a recent written Dáil reply on the ‘cash for gold’ sector, Justice Minister, Frances Fitzgerald said that while such outlets “may, inadvertently, be fuelling continued high rates of burglary and theft, it is, of course, possible that businesses such as these are among the routes utilised by persons seeking to dispose of stolen goods. However, I am informed by An Garda Síochána that they have no evidence that would suggest a direct link between burglaries and the ‘cash for gold’ sector.”

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