Jan 152016

Three years ago tomorrow (16 January 2013), Deutsche Bundesbank announced that they would be repatriating 300 tonnes of gold from New York and 374 tonnes from Paris by 2020, which was a revision of their October 2012 promise they would transfer 150 tonnes from New York by 2015. So how have they progressed and are they meeting their schedule?

In January last year I did an analysis of the state of the German repatriation.  At that time Deutsche Bundesbank said they had “transferred 120 tonnes of gold to Frankfurt am Main from storage locations abroad: 35 tonnes from Paris and 85 tonnes from New York”, which, when added to the 32t and 5t (respectively) transferred in 2013 means they had transferred 157 tonnes in total by December 2014.

Based on data accumulated each month from the US Federal Reserve by Nick Laird of Sharelynx, the Fed’s custodial gold holdings have reduced by 125 tonnes from January to November 2015. I am fairly confident that all of these are German repatriations as there hasn’t been any announcements of other central banks withdrawing metal from the Federal Reserve’s vaults in New York. In addition, the amounts delivered each month are similar to those that occurred in 2014, as the chart below shows.


To-date, Germany looks to have returned 215 tonnes, which is well over their initial promise of 150 tonnes. In this chart I forecast that based on the monthly rate of 2015 withdrawals, Germany should have repatriated all of their planned 300 tonnes by September 2016, putting them over three years ahead of the “by 2020” target.

It seems what Carl-Ludwig Thiele, Member of the Executive Board of the Deutsche Bundesbank, said in this interview with Handelsblatt in February 2014 was true: “the Americans have never stonewalled or hindered us in any way. On the contrary, their cooperation has been most constructive in every respect”.

By the end of this year Germany would have around 1,237 tonnes in New York, which would be 37% of their total gold reserves. But why stop there? If the US Federal Reserve and Germany have demonstrated that they can move around 130 tonnes a year, then continuing on at that rate for the remaining 3 years and 3 months would result in another 422 tonnes back on German soil with 814 tonnes left in New York (24%), surely enough, along with 400 or so tonnes in London, “so that, when push comes to shove, we can have it available as a reserve asset as soon as possible” (Carl-Ludwig Thiele in October 2012)?

As to the Paris repatriations, we don’t have any independent indication of what they have delivered during 2015. With a 374 tonne target, and only 67 tonnes confirmed returned as at December 2014, Germany will have to move at least 61.5 tonnes a year from 2015 through to 2019 to meet the target. Anything less than that will raise questions, particularly considering that it would have to be easier to ship gold from Paris to Frankfurt than from New York.

Based on the dates of the previous repatriation updates, here and here, we should have our answer some time next week.