UK to sell gold and buy dollars, euros, and yen
"UK says to start selling some gold reserves"
LONDON, May 7 (Reuters) - The British Treasury said on
Friday it intended to sell 125 tonnes of gold in fiscal
1999/2000 as part of a restructuring of the country's reserve
holdings.
The Treasury said there would be five auctions, likely of 25
tonnes each, with the first on July 6.
The Treasury also said it intended to reduce Britain's gold
holdings over the medium term to 300 tonnes from a current level
of 715 tonnes, at a rate similar to that announced on Friday.
The Treasury said the gold holdings would be replaced by
foreign currency assets, split roughly 40 percent in U.S.
dollars, 40 percent in euros, and 20 percent in yen.
A Treasury spokesman said that if Britain were to join the
euro, it would need to deposit around 140 tonnes of gold at the
European Central Bank, less than half the level it intends to
retain.
The Treasury said Britain's gross reserves totalled $37
billion at market prices but its foreign currency liabilities
amounted to $22 billion. The $6.5 billion held in gold therefore
makes up around half of the unhedged, or net, reserves.
The programme of gold auctions will be made from the
exchange equalisation account. Future auctions in 1999/2000 will
be in September, November, January and March 2000.
For full details, double-click on
((London newsroom +44 171 542 5109, fax 542 6726, e-mail
dan.lalor@reuters.com)) |
