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Venezuela fails to reclaim the gold it pawned to Deutsche Bank
That's a lot more central bank gold that hit the market since the swap was undertaken in 2016.
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Venezuela Allows $1.7 Billion Gold Swap with Deutsche Bank to Lapse, Legislator Says
By Corina Pons
Reuters
Monday, October 22, 2017
CARACAS -- Venezuela this month allowed a $1.7 billion gold swap with Germany's Deutsche Bank to lapse, according to an opposition legislator who said it weakens the balance sheet of the crisis-stricken OPEC nation's central bank.
Through the operation, Venezuela had received $1.2 billion in cash in exchange for putting up $1.7 billion worth of gold in guarantee, part of efforts to improve the liquidity of foreign reserves amid heavy foreign debt payments and low oil prices.
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Legislator Angel Alvarado said the contract's expiration weakens international reserves, which are hovering near 21-year lows as the country's socialist economic model collapses under low oil prices.
"Venezuela decided to allow this contract to lapse," said Alvarado in a telephone interview today. "We think the government could have negotiated better."
The central bank will receive another $500 million in cash to reflect the difference between the amount of the loan and the value of the guarantee, said Alvarado, who obtained the information from finance industry sources.
Venezuela had to pay $1.2 billion by the middle of October to recover the gold, he said. ...
... For the remainder of the report:
http://www.reuters.com/article/us-venezuela-economy/venezuela-allows-1-7...
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