Singapore looks to host foreign central banks’ gold reserves

2026-03-27 - 05:01

Data showed central banks worldwide held nearly 39,000 tonnes of gold, while Singapore recorded 193.6 tonnes in January. (Unsplash pic) SINGAPORE: Singapore is planning to expand its gold-storage capacity to become a custodian of bullion held by foreign central banks, part of a broader push by the city-state to compete with Hong Kong as a regional hub for the precious metal. The Monetary Authority of Singapore said Friday it will “look to provide vaulting services for foreign central banks and sovereign entities to meet potential demand.” It’s also developing “gold-related capital market products to promote price discovery and build liquidity.” In addition, MAS plans to build a clearing system to support over-the-counter settlement for trading gold locally, according to a joint statement with the Singapore Bullion Market Association. Singapore’s ambition to become a major gold-trading hub follows a historic rally for the precious metal underpinned by a search from investors for alternative stores of wealth. Though bullion has retreated since the war began in the Middle East, many central banks – including China’s – have been steadily adding gold over the past few years as a way to hedge against US dollar dominance. As part of its push, the government has established a working group that includes JPMorgan Chase & Co and UBS Group AG as well as DBS Group Holdings Ltd, United Overseas Bank Ltd and ICBC Standard Bank Plc. Bloomberg News first reported the initiative earlier in March. Attracting central banks – the ultimate providers of liquidity, given the large volumes of gold they hold in reserves – will be among the keys to Singapore’s plans, along with support from established financial institutions that serve as market-makers. Together, they form the backbone of the world’s dominant gold-trading hub – London – where billions of dollars’ worth of the metal is traded every day. Globally, central banks hold nearly 39,000 tonnes of bullion – or about 18% of all gold ever mined – according to the World Gold Council. Even a small share of that market would bolster Singapore’s influence in regional trade that is currently dominated by Hong Kong – the gateway for precious metals going in and out of China, the world’s largest consumer of bullion. “The space is big enough for us to co-exist and for both cities to be able to grow our respective services,” said MAS deputy chairman Chee Hong Tat, who is also Singapore’s minister for national development. Central banks and investors “see gold as an asset that can help them in this more uncertain environment,” he told reporters during a briefing on Friday. Singapore’s proposal could potentially attract nations that have challenged the status and credibility of historic hubs such as London and New York. A number of countries including Germany have repatriated gold for security reasons, and there have been similar moves from Poland, the Netherlands and Serbia. In Asia, the People’s Bank of China is backing the Shanghai Gold Exchange to court central banks in friendly countries to buy bullion and store it within the country’s borders, Bloomberg News reported in September. Cambodia was one of the first countries to take up Beijing’s offer. Singapore’s gold reserves stood at 193.6 tonnes as of January, according to data from MAS.