{"text":[[{"start":6.24,"text":"When the Dutch central bank announced last month that it had transferred more than 78 tonnes of gold from New York to London, it was unusually open about its motives. Not only would bullion stored in the Bank of England’s vaults be available in a crisis, but it would also join “the world’s most easily tradeable gold”."}],[{"start":24.28,"text":"London could hardly have asked for a better endorsement in its historic rivalry with New York, where most gold futures are traded. The Netherlands is not alone in appreciating the City: the stash of bullion held in London vaults has risen steadily over the past year, reaching nearly 10,000 tonnes of gold, worth $1.3tn, last month."}],[{"start":45.54,"text":"Central banks have been buying gold as they diversify away from US government bonds as a reserve asset. Gold has also returned to London after banks and hedge funds moved bullion to New York last year in response to rising prices and worries that the US would impose import tariffs on the metal."}],[{"start":62.44,"text":"London’s gold market is now enjoying the Trump effect: the US president loves both gold and being unpredictable, but the latter is anathema to central banks. They are cautious when it comes to the safety of their bullion reserves. Many have been bringing gold bars closer to home since Russia’s sovereign assets were frozen following the 2022 full-scale invasion of Ukraine."}],[{"start":83.28,"text":"Although Venezuela is nearing a deal to transfer its $4bn gold reserves from London to New York, the Dutch move is part of a trend for holding more gold outside the US. The Bundesbank has about a third of its gold in New York and its president Joachim Nagel insists he has “no doubt” about its safety. But there have been calls in Germany to repatriate it."}],[{"start":104.2,"text":"New York remains the leading financial centre for gold derivatives, thanks to futures trading on the Comex exchange and the 6,300 tonnes of the metal held at the Federal Reserve Bank of New York. But, while US stock markets have a magnetic pull, there is little sign that London’s grip on the physical trading of gold is weakening."}],[{"start":122.92,"text":"The BoE’s record as a safe custodian, despite the UK having sold half of its own gold 25 years ago, makes London a natural destination. The City offers more than safekeeping. Gold can be traded or lent on its bullion market without having to leave the vaults, allowing central banks to earn a yield on their assets."}],[{"start":141.9,"text":"This is the key to London’s global dominance in “over-the-counter” gold trading. Gold held at the BoE or in the UK vaults of the largest bullion banks, such as HSBC and JPMorgan, can either be simply stored or flow in and out of its trading market. Even some of the metal backing New York-listed exchange-traded gold funds is held in London."}],[{"start":162.12,"text":"It is not easy to move. Shifting gold reserves directly to New York requires London’s 12.5kg “good delivery” bars to be melted down in Zurich refineries and remoulded to US standards. “London’s dominance in physical trading looks absolutely solid,” says Adrian Ash, research director of BullionVault, an online bullion marketplace."}],[{"start":183.24,"text":"Global competition is growing. The rise in bullion prices amid central bank buying and political instability has restored gold to its historical importance. Owning gold bars is no longer derided as the obsession of eccentrics and “gold bugs”. That makes other financial centres, particularly in Asia, keen to strengthen their position."}],[{"start":203.4,"text":"Singapore is launching a bank clearing system for gold this year and is competing with Hong Kong to attract more trading, although it denies that it wants to displace the City. London is making another attempt to compete in derivatives: the Intercontinental Exchange has launched a new gold futures contract."}],[{"start":220.24,"text":"The rise of digital assets such as gold “tokens” is a longer-term uncertainty. These still need to be backed by gold held somewhere: the cryptocurrency exchange Tether has 22 tonnes of gold in Switzerland to back its gold token. But digital assets do not need the full banking facilities of London’s gold market for trading and clearing."}],[{"start":239.98,"text":"The City also faces a legal challenge to its market. The London Bullion Market Association, which sets standards for refiners to deliver gold to City vaults, was accused in court last week of having caused the deaths of two miners in Tanzania. The LBMA denies liability and the case will decide how much responsibility it has for monitoring mines."}],[{"start":259.72,"text":"But London remains the gold standard for physical trading. For now at least, its position is strengthening. The growing stacks of gold bars in City vaults are testament to that."}],[{"start":276.52,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1792061640_2874.mp3"}