French far-right leader Le Pen calls for gold reserves to be repatriated

Nov 26, 2014 - 10:18 AM GMT

Marine Le Pen, leader of the far-right Front National party in France and currently the frontrunner for the presidency of the country, has called on the central bank to repatriate its gold reserves.

In an open letter penned to Christian Noyer, the governor of the Banque de France, Le Pen demanded the urgent repatriation of all gold reserves located abroad and the immediate discontinuation of any gold sales programmes.

She called for a complete audit of the inventory of 2,435 tonnes of physical gold by an independent French body to indicate in which country France’s gold reserves are currently stored.

She also demanded a gradual reallocation of a portion of foreign exchange reserves within the Banque de France, recommending that the central bank buy gold at each significant decrease in spot pricing.

Spot gold has recovered to current levels either side of $1,200 per ounce from four-year lows of $1,131.60 in October.

France is the fifth-largest holder of gold in the world, behind only the US, Germany, the IMF and Italy, according to the November central bank holdings report by the World Golf Council – it holds 2,435.4 tonnes of gold, accounting for 65.1 percent of its reserves.

Between 2004 and 2012, France sold 614.6 tonnes of gold during a period when, according to Le Pen, other central banks in the eurozone had agreed to limit gold sales.

Germany and the Netherlands are already repatriating their gold reserves and Switzerland may follow suit, depending on the results of this weekend’s referendum.

De Nederlandshe Bank (DNB), the Dutch central bank, said last week it has repatriated 20 percent of its gold reserves from the US back into the country’s vaults. Around 122 tonnes of the metal have been shipped to Amsterdam, worth more than $5 billion at current spot prices.

And on Sunday, voters in Switzerland will decide whether or not to outlaw further gold sales from the Swiss National Bank, to make physical bullion at least 20 percent of the bank’s assets and whether to repatriate Swiss-owned gold.

Should the country still vote in favour of these proposals, the SNB will be forced to enter the physical bullion market to raise its gold holdings from around 7-8 percent at present, according to World Gold Council statistics.

(Editing by Mark Shaw)