Central Bank Gold Agreement
On 19th May 2014, the European Central Bank and 20 other central banks announced the signing of the fourth Central Bank Gold Agreement. This agreement, which applies as of 27 September 2014, will last for five years and the signatories have stated that they currently do not have any plans to sell significant amounts of gold.
Central banks have a commitment to being stewards of stable markets, in particular where it involves their own investment behaviour. The sharp and abrupt swings in the gold price prior to the first CBGA show what a world without an agreement might look like. The agreements have provided the gold market with much needed transparency and a commitment from global central banks that they will not engage in uncoordinated large-scale gold sales.