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Mineweb reported that three new participants have been added to the LBMA Gold Price benchmarking process. One of those is the Bank of China, and rumor has it that another Chinese bank will also be approved for participation.
Mineweb reported that three new participants have been added to the LBMA Gold Price benchmarking process. One of those is the Bank of China, and rumor has it that another Chinese bank will also be approved for participation.
As quoted in the market news:
It should be recalled that when the new benchmarking process was set up earlier this year there was considerable speculation that up to three Chinese banks, which would seem to meet all the parameters to membership of the elite group of price setters, would be involved. Come the event there was considerable disappointment among the gold bulls in particular, and some others, that no Chinese banks were involved. Indeed the initial participants were effectively the same banks, which had been participating, in the old system. These were subsequently joined by first Goldman Sachs and UBS and then by JP Morgan … making for a grouping which would raise the blood pressures of those who believe in gold price manipulation by the bullion banks in conjunction with certain central banks as the LBMA participants then comprised virtually all the usual suspects in suggested gold price rigging scenarios.
Now, at least one Chinese bank is involved and, as noted above, may be joined by another shortly. Whether this on its own will do anything to allay the suspicions of the gold bulls remains to be seen, or whether it will make any difference to the pricing mechanism itself.
