Gold deal ends among European central banks

FRANKFURT, Germany — The European Central Bank says it and 21 national central banks in Europe are letting an agreement regulating gold sales expire, saying the deal struck two decades ago to stabilize the market for the precious metal is no longer needed.

The ECB said Friday that the fourth Central Bank Gold Agreement would not be renewed when it expires Sept. 26.

The first such agreement was signed in 1999 amid concerns about the impact of uncoordinated sales by central banks from reserves mostly concentrated in rich European and North American countries as a legacy of the days when currencies were pegged to gold. Central banks agreed to coordinate transactions to keep the price from swinging excessively.

The ECB said that the central banks that are part of the agreement have not sold significant amounts of gold for nearly a decade, eliminating the need for the deal.

At the end of 2018, central banks collectively held around 33,200 tons of gold, about one fifth of the gold ever mined, according to the World Gold Council. Those holdings mean central banks have immense pricing power in markets. The first agreement, also known as the Washington Gold Agreement, was preceded by abrupt swings in the gold price.

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