In low key move, Singapore’s central bank adds 26 tonnes to its gold reserves

It has simply come to gentle that Singapore’s central financial institution, the Financial Authority of Singapore (MAS), added 26.35 tonnes of gold to its official financial gold reserves over a 2 month interval between Could and June this yr, within the course of boosting its strategic gold holdings by 20% to a claimed 153.76 tonnes.

This addition to the financial gold holdings of the Financial Authority of Singapore was first identified by the World Gold Council’s Krishan Gopaul in a 25 November tweet, following an replace to Singapore’s gold holdings showing within the IMF’s Worldwide Monetary Statistics (IFS) database, a supply which World Gold Council makes use of to maintain monitor of central financial institution and sovereign gold holdings.

Could and June: 26.35 tonnes added

Whereas it’s unclear why modifications to Singapore’s financial gold holdings from Could and June solely made it on to the IFS database in current days, wanting extra intently, the Financial Authority of Singapore did ‘replicate’ the Could and June gold purchases on the finish of July and August, respectively, through updates to the MAS’ month-to-month “Worldwide Reserves and Overseas Foreign money Liquidity” report, however didn’t announce or point out the additions particularly.

Earlier than how this substantial gold buy by Singapore went unnoticed, listed below are the uncooked numbers from the MAS website itself. Up till the tip of April 2021, Singapore’s central financial institution (MAS) had been reporting whole gold holdings of 4,096,439 advantageous troy ounces, or 127.42 tonnes, a determine which had not modified since at the very least 2002 (which is way back to World Gold Council information go).

Throughout Could 2021, MAS reviews that it added 527,201 ozs (16.4 tonnes) of gold, taking it’s gold holdings as of finish of Could to 4,623,640 ozs (143.81 tonnes).

Throughout June 2021, MAS reviews that it added an extra 319,801 ozs (9.95 tonnes) of gold, which elevated MAS’ gold holdings as of finish of June to 4,943,441 ozs (153.76 tonnes).

Which means that over the 2 months Could and June 2021 inclusive, MAS bought 847,002 advantageous troy ounces of gold (26.35 tonnes), and in doing so elevated it’s gold holdings by 20.67%, and on the identical time rising from 30th to twenty-eightth place on the earth gold holding rankings.

Quietly and Discreetly

Every month, the World Gold Council (WGC) updates it’s World Official Gold Holdings spreadsheet (xls) by which it ranks sovereign gold holders largest to smallest based mostly on what number of tonnes of financial gold every nation holds. Trying on the newest model of this report (November), it lists Singapore in 30th place with 127.4 tonnes ‘as of August 2021’, and this spreadsheet has not but been up to date (at time of writing) to replicate the 26 tonnes of gold bought by Singapore in Could and June.

The WGC rating methodology states that: This desk was up to date in November 2021 and reviews information accessible at the moment. Information are taken from the Worldwide Financial Fund’s Worldwide Monetary Statistics (IFS), November 2021 version, and different sources the place relevant. IFS information are two months in arrears, so holdings are as of September 2021 for many nations, August 2021 or earlier for late reporters.

IMF IFS information will solely get up to date if and when a person nation informs the IMF of a change to that nation’s gold holdings. It seems then that the World Gold Council’s information for Singapore’s gold holdings relies solely on the IMF IFS information, and that this IFS information has for some purpose solely in current days been up to date to replicate Singapore’s gold purchases, which implies that for some purpose Singapore has solely very not too long ago knowledgeable the IMF of it’s Could-June gold shopping for.

For verification, I ran an information question within the IMF IFS database for search standards Singapore, for every month of 2021, with the info indicator of “Worldwide Reserves and Liquidity, Reserves, Official Reserve Belongings, Gold (Together with Gold Deposits and, If Applicable, Gold Swapped), Quantity in Tens of millions of Wonderful Troy Ounces, Wonderful Troy Ounces”.

This information question output the next:

IMF IFS information extract exhibiting Singapore’s gold holdings from January – August 2021

From the IFS information, you possibly can see that Singapore’s (MAS) gold holdings remained unchanged at 4.1 million ozs till the tip of April 2021, then elevated to 4.62 mn ozs on the finish of Could, after which elevated once more to 4.94 mn ozs on the finish of June, after which MAS gold reserves remained unchanged.

MAS Month-to-month Worldwide Reserves report

Nonetheless, realizing now that MAS bought gold throughout Could and June, I went again and checked on the precise MAS month-to-month ‘Worldwide Reserves and Overseas Foreign money Liquidity’ reviews on the MA web site.

The MAS ‘Worldwide Reserves and Overseas Foreign money Liquidity ‘ report for April 2021, which was printed on 30 June 2021, reveals the Singaporean central financial institution reporting a complete of 4,096,439 advantageous troy ounces (or 127.42 tonnes). See Merchandise 4 “Gold (together with gold deposits and, if applicable, gold swapped)”.  

The identical report for Could 2021, which was printed on 30 July 2021, then reveals that the amount of gold held by MAS on the finish of Could was 4,623,640 advantageous troy ounces, which was 16.4 tonnes greater than on the finish of April.

The report for June 2021, printed on 31 August 2021, reveals that as of finish of June MAS held  4,943,441 advantageous troy ounces of gold, a 9.95 tonne enhance over Could, and a mixed Could-June enhance of 26.35 tonnes.

Only for completeness, the report for July 2021, printed on 30 September, reveals that gold holdings then remained fixed at 4,943,441 ozs, i.e. there have been no additional gold purchases past June.

Singapore quantity of gold held, as per MAS “Worldwide Reserves and Overseas Foreign money Liquidity’ report, finish of June 2021. Supply

Regardless of the two-month lag in reporting, these reviews present that the Financial Authority of Singapore (MAS) did report will increase in gold holdings on 30 July and once more on 31 August, however for no matter purpose, nobody seen, or else those that seen it didn’t publicise it. There’s a slight probability that MAS has not too long ago altered it’s “Worldwide Reserves” reviews since Could to retrospectively present these gold purchases, however it will appear fairly absurd to take action, even within the secretive world of central financial institution gold reporting.

In addition to, an Web Archive of the preliminary MAS “Worldwide Reserves” report for finish of August (printed finish of September) and archived on the Wayback Machine on 6 October, reveals that even then (on the finish of September) MAS was, on it’s web site, reporting it’s newest gold holdings of 4,943,441 ozs.

The Secretive World of Central Financial institution Gold

So total, it appears to be a case of nobody noticing the up to date gold holdings information within the MAS month-to-month “Worldwide Reserves” reviews for the reason that finish of July, and on the identical time, the Financial Authority of Singapore (MAS) not highlighting it’s gold purchases to both the gold market or the monetary press, i.e. there was no press launch, no different type of announcement, nor even any touch upon both the MAS web site or from central financial institution officers. In distinction, central banks, resembling Poland, have made many public statements about their gold shopping for, and even sign their gold shopping for upfront.

For a central financial institution which actively publishes reams of publications and reviews on all kinds of matters associated to Singapore’s monetary sector and markets and it’s worldwide monetary place, this omission about Singapore’s sizeable gold purchases might be thought of fairly unusual, however then once more, provided that we’re coping with the secretive world of gold and central banks, possibly it’s not so unusual.

As well as, MAS is known for it’s obsession with sustaining and controlling the trade fee of the Singaporean greenback (versus a basket of currencies), so maybe MAS prefers not to attract consideration to the quantity of gold in it’s worldwide reserves as this may encourage FX markets to view the gold buy as a transfer that strengthens Singapore’s reserve place and therefore might put upward stress on it’s trade fee.

Showcase within the GIC (Sovereign Wealth Fund) Workplace in Singapore commemorating Singapore’s first gold buy of 100 tonnes  in 1968 – “A Torn Greenback Invoice And Gold For Singapore”. Supply

From Washington to Switzerland 

In 1968, Singapore’s finance minister Dr Goh Keng Swee and senior adviser Ngiam Tong Dow have been liable for securing Singapore’s first gold reserves after they negotiated with South Africa’s finance minister Nicolaas Diederichts to buy 100 tonnes of gold from the South Africans at $40 per ounce whereas attending a World Financial institution assembly in Washington D.C.

Realising that the Bretton Woods system would quickly collapse, and on recommendation from Ngiam Tong Dow, Dr Goh determined “In that case, we had higher go and purchase gold from the South Africans.”  

On condition that there was an embargo on South Africa, intriguing the gold deal was performed in Dr Goh’s lodge room in Washington D.C. and so they turned up the TV to full quantity to counter attainable listening units. Based on Ngiam Tong Dow, when Diederichts agreed, he mentioned “OK, you ship your man to Switzerland, we’ll ship the gold to you in Switzerland, and also you pay us in Switzerland.” Diederichts then took out a $1 invoice, ripped in in two halves, saved one half, and gave the opposite half to Ngiam Tong Dow saying ‘You retain this. I’ll preserve the opposite half, and my man will meet you in Switzerland.” And identical to that, 100 tonnes of gold modified arms. It could sound like a James Bond storyline, however this story is definitely factual.       

A number of months later the deal was finalised when Ngiam Tong Dow and Singaporean banker Wee Cho Yaw flew into Switzerland and went to the workplaces of the Swiss Financial institution Company (SBC) the place they met the Swiss banker representing the South Africans. Upon handing him the one half of the greenback invoice, and seeing that the serial numbers matched, the Swiss banker mentioned “OK, your id has been established”. And the remaining, as they are saying, is historical past.

Someday subsequent to 1968 (however earlier than 2002) Singapore added to its gold reserves to deliver them as much as the 127.4 tonnes degree, and now but once more, Singapore has added one other 26.35 tonnes throughout Could and June 2021.

Extract from “A Mandarin and the Making of Public Coverage” Reflections of Ngiam Tong Dow, Supply

Whereas the negotiation of this newest gold buy might not have been as intriguing and James Bond-esque as Singapore’s 1968 gold buy, on the earth of central financial institution gold markets something is feasible, and we might properly think about MAS officers in unique Swiss places or Washington DC accommodations.

However like their 1968 compatriots who have been quiet and discreet of their negotiations, so but once more Singapore’s central bankers have added a sizeable tonnage to Singapore’s financial gold reserves, so discreetly, that nobody, till now, even seen. And that’s the way in which the secretive central bankers prefer it.

But with this gold buy, Singapore’s central bankers are actually signaling that after years on the sidelines, they really feel compelled presently to return again to the gold market as consumers.  Whereas but not coated by mainstream monetary media, this can be a main transfer by one of many world’s most savvy and discreet central banks. 


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