Russia central bank doesn't want banks buying precious metals
11:55 a.m. Aug 31, 1998 Eastern
MOSCOW, Aug 31 (Reuters) - Russia's central bank stopped releasing daily offer quotations for gold, silver and platinum as an indication to banks that they should not invest in the precious metals now, the bank's spokeswoman said on Monday.
''The central bank does not believe it necessary to give banks an indication that they should transfer money into assets which now have low liquidity, like gold,'' Irina Yasina told Reuters.
The central bank, which had released daily bid/offer quotations for gold, silver and platinum, from Friday began issuing only bids to buy the precious metals.
The bank had bid to buy gold at 68.09 roubles per gramme on Monday, down from 68.97 roubles on Friday, silver at 1.19 roubles per gramme from 1.23 roubles and platinum at 87.17 roubles per gramme, down from 89.91 on Friday.
Gold prices fell to a 19-year lows in Europe and in New York on Friday.
But on Thursday the Association of Russian Banks (ARB) said Russians had increased gold purchases in an attempt to trade in their devaluing rouble assets and in the face of limited foreign currency for sale.
The head of ARB's precious metals department, Dmitry Ignatyev, told a briefing that despite the 20 percent value added tax, Russians have bought about a tonne of gold from commercial banks last week.
ARB suggested that the central bank could sell up to 250 tonnes of gold from its reserves to commercial banks to satisfy public demand.
Russians rushed to buy dollars to preserve their savings after the government and central bank allowed an effective devaluation of the currency by widening the bands in which it would be permitted to fluctuate to 6.0/9.5 to the dollar from 5.27/7.13. It has allowed some trading outside those bounds.
Russia's main currency exchanges on central bank orders suspended trading last week because of pressure on the rouble after months of crisis.
Currency exchanges across Moscow offered rates of eight to nine roubles per dollar on Monday, though on the SELT electronic exchange (MMVBSELT) the rouble was traded at an average rate of 10.8376 to the dollar and was as low as 13.00 roubles.
Sergei Kyshtymov, head of the central bank's precious metals department, told Reuters on Monday that the bank was ready to re-establish offer quotes for gold after rouble stabilisation.
''We will be ready to release two-way quotes when the bourse trade starts again,'' Kyshtymov said.
((Aleksandras Budrys, Moscow Newsroom, +7095 941-8520 moscow.newsroom+reuters.com))
Copyright 1998 Reuters Limited. |
