Bucking Gold Repatriation Trend, Argentina Sends More Gold to London

September 18, 2024

In July, the Central Bank of Argentina (BCRA) shipped another 3 tonnes of gold to the U.K. to swap for foreign exchange. A month prior, BCRA also transported 3 tonnes to the U.K. BCRA is now estimated to have 37 tonnes (60% of Argentina’s gold reserves) on swap in the London Bullion Market.

Argentina Is Leveraging Its Physical Gold

Argentine newspaper Clarín reported in 2017 that BCRA moved 11 tonnes of its monetary gold to London, according to their research, to be swapped out for Japanese yen. “We are already doing this with all the gold we have in London, because by placing it in that financial center, we can expand its use,” the central bank told to Clarín at the time.

El País reported in July of 2024 that BCRA was again transporting gold abroad. After rumors were making rounds about how much gold was shipped out and to where, President Milei hinted that the gold was used overseas as collateral for a loan (this is how a swap typically works). Argentina appears to be in need of foreign currency to pay interest or to pay off debt.

Argentina Sends More Gold to London

A few weeks back, I was able to confirm BCRA had sent $150 million worth of gold (3 tonnes) to the U.K. in June, based on cross-border trade statistics. Because officials had confessed that part of the Argentinian monetary gold was sent abroad, and for the first time ever the U.K.—home of the largest gold market globally—recorded to have imported 3 tonnes from Argentina that month, I was confident this batch could be assigned to BCRA.

Monetary gold can cross borders outside the scope of customs statistics, which apparently happened in 2017. However, if a central bank lets a bullion bank take care of the shipping, the bullion bank has to deal with customs, and the gold will show up in trade data (as was the case with the secret purchases by Saudi Arabia’s central bank in recent years).

In the same spirit, new trade data from the UK shows another import of 3 tonnes from Argentina for July. It looks like BCRA is sending more and more gold to London in a desperate need for foreign exchange.

Most of Argentina’s Gold Is Now Held in London

Bloomberg recently wrote that, according to its sources: “before the move, about half of Argentina’s gold was in domestic vaults with the other half in London.” Bloomberg speculated there was only one shipment of gold to Europe, which would be the one in June.

So, before June, half of BCRA’s total gold reserves (62 tonnes) were in London. Adding 6 tonnes transferred in June and July means there are now 37 tonnes abroad, which equals 60% of Argentina’s monetary metal.

If Milei succeeds in getting Argentina’s finances in order, international debt can be repaid and foreign exchange obtained through trade can be used to unwind the swaps. If not, BCRA could default on its swap obligations and thereby surrender ownership of 36 tonnes of precious metal.

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Jan's first career was in the Dutch movie industry as a sound engineer. In 2014 he decided to switch jobs and started researching gold. At first he mainly wrote about the Chinese gold market, for which he gained global recognition. Subsequently, he also began analyzing other parts of the gold market, such as the COMEX futures market, the London Bullion Market, and the Turkish gold market. In addition he has expanded his field of research to macro economics. Currently, he writes about the international monetary system, central bank gold policies, the mechanics of the global gold market, the gold price and economics in general. When he’s not researching economics Jan likes to play various sports, read books, meditate, and watch documentaries.


The average human body contains 0.2 mg of gold with the bone containing .016 ppm and the liver .0004 ppm.
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