Politicians in Germany and Italy have recommended that their governments return to Europe some of their gold reserves worth more than 245 billion USD stored in the US, the Financial Times (FT) reported.
The calls come against the backdrop of “growing geopolitical turbulence“ and US President Donald Trump's conflict with the Federal Reserve over its refusal to lower its key interest rate. As Fabio De Massi, a former member of the European Parliament and current member of the German party “Sahra Wagenknecht Union - For Reason and Justice“, told the newspaper, there are “strong arguments“ in favor of moving gold to Europe “in these turbulent times“.
According to the World Gold Council, Germany and Italy have the second and third largest gold reserves in the world (after the United States). The countries hold over 3,300 and 2,400 tonnes of gold respectively, and both store more than a third of their bullion at the New York Federal Reserve.
In an interview with the FT, Peter Gauweiler, a former member of the Bundestag (German parliament) from the conservative Christian Social Union, noted that the German Federal Bank (Bundesbank) “should not compromise“ on the issue of ensuring the safety of the country's gold reserves. The politician believes that the German authorities should consider whether “storing gold abroad has become safer“ in the past ten years. “The answer to that is obvious”, Gauweiler said.
“We are very concerned that Trump is undermining the independence of the Federal Reserve,” Michael Jaeger, president of the European Taxpayers Association, told the newspaper. He recommended that German and Italian gold be returned “to their home countries”, so that European central banks can have “unrestricted control over it at all times”. According to Jaeger, the association has already sent letters to the finance ministries and central banks of Germany and Italy asking them to reconsider their dependence on the US Federal Reserve.
At the end of May, the “Bild” wrote that the European Taxpayers Association and several politicians from the Christian Democratic Union (CDU/CSU) bloc are calling for some of the German gold stored in the US, which is considered an emergency reserve, to be returned to Germany or Europe as soon as possible. According to the publication, this step is necessary given the growing tension in transatlantic relations and doubts about the independence of the US Federal Reserve. As Jaeger said at the time, German gold will sooner or later attract the interest of the Trump administration.