10:44a ET Wednesday, October 15, 2025
Dear Friend of GATA and Gold:
Today's Financial Times publishes in its "Alphaville" section a commentary by its writer Toby Nangle calling attention to the dodginess of data offered about central bank gold reserves. The commentary is sarcastically headlined, "Central Banks Have Been Buying a Squillion Tonnes of Gold, Promise":
https://www.ft.com/content/6144f373-f217-423e-b7c4-e872ff323fbe [1]
Nangle writes: "So why is everyone talking about unprecedented levels of central bank buying? It turns out that these reports rely on estimates of 'unreported' official gold demand." He notes that central bank gold reserve reports to the International Monetary Fund are "purely voluntary" and that the World Gold Council's estimates of "unreported" central bank purchases are compromised by the council's role as a cheerleader for the monetary metal industry.
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But Nangle omits the foremost proof that official gold reserve data is not just unreliable but often aggressively false: the secret March 1999 report of the IMF staff, which GATA published in 2012 and has sent to the FT many times since:
https://www.gata.org/node/12016 [4]
The IMF staff report says central banks refuse in their gold reserve reports to distinguish unimpaired reserves from reserves that have been leased out, because distinguishing unimpaired reserves from impaired reserves would expose surreptitious central bank interventions in the gold and currency markets and reveal how much more capacity central banks have for such interventions.
The Reserve Bank of Australia has been fairly candid about this. Its 2003 annual report said "foreign currency reserve assets and gold are held primarily to support intervention in the foreign exchange market":
http://www.gata.org/files/ReserveBankOfAustraliaAnnualReport2003.pdf [5]
More recent annual reports of the bank have put it this way:
"Australia's official reserve assets include foreign currency assets, gold, Special Drawing Rights (SDRs -- a liability of the IMF), and Australia's reserve position in the IMF. Reserve assets are held primarily to facilitate policy operations in the foreign exchange market":
https://www.rba.gov.au/publications/annual-reports/rba/2015/pdf/2015-report.pdf [6]
Nangle concludes: "Putting the gold rally at the door of central bank buying is massively intuitive."
Maybe it is. But figuring out central bank involvement with gold would not have to be so "intuitive" if the FT ever attempted some journalism where central banks don't want it to go -- like their gold leases, swaps, other interventions, and their possibly desperate efforts to recover metal whose impairment they concealed.
Indeed, gold's near-vertical rise this year closely resembles a short squeeze, and the documents GATA has compiled for more than 25 years show that central banks have done a lot of shorting gold as a matter of policy:
https://www.gata.org/node/20925 [7]
That the FT ignores this stuff also seems to be a matter of policy.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org [8]
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