Other central banks may well be considering a similar move. They are subject to the same state of geo political circumstances as the Dutch and may reach a similar conclusion, or not. As to why wouldn’t it add to currency uncertainty, I think that there are two parts to that. Firstly do the mechanics of this move result in any particular changes to demand and supply for any particular currency? It seems the answer is no. Some gold was physically moved. That doesn’t affect the demand and supply of anything. Some gold was sold in New York and replaced by a matching transaction in London. Both sides will have been priced in USD because gold markets are traded in USD regardless of location. So no mechanical impact on currencies. Secondly, what about sentiment. Does the move indicate that the Dutch think the USA is in imminent danger of collapse, or that their gold might be seized, or confiscated or some other form of appropriation? Well, what many posters on here seem to have missed is that only a very small percentage of total gold holdings was moved. So this was a reweighting exercise, not a total retreat from North America. So why would currency markets react to a relatively small reweighting exercise as though it’s some kind of disaster? Symbolically it’s hardly a vote of confidence in North America, but the Dutch central bank still maintains 18% of its gold holdings in USA and Canada. So that’s 36% overall. Quite a lot of money. It’s true that this news has only just hit the mainstream news, at least as far as I know. But the shipping of the gold and the gold transactions have been going on for months. I didn’t know they were happening, but I’d bet that there are plenty of London commodity and currency traders who did know. So overall, I personally am not seeing any spill over into currency markets. Cue the headline “ USD crashes because Dutch central bank moved nearly 2% of its gold reserves from New York to London”. But imho, that headline is unlikely to appear. That’s not to say that others aren’t considering doing the same, or that the Dutch won’t gradually do more. There ARE very obvious reasons to state that the economic and political situation in USA is causing distrust and uncertainty within North America, as it is for pretty much the rest of the world.
