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Iraq has boosted its gold reserves

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1Iraq has boosted its gold reserves Empty Iraq has boosted its gold reserves Mon Dec 24, 2012 12:32 am

windreader1



Is Iraq Assisting Iran in Circumventing Sanctions?

Posted GMT 12-23-2012 17:19:5

The Financial Times reported on Friday that Iraq has boosted its gold reserves by 25 tons in just 3 months.

Financial analysts in London attributed the huge boost in Iraq's gold reserves from about 5 tons to 30 tons since October to Iranian payments of gold to Iraq, possibly in return for US dollars and other trade, which might be in circumvention of US and international sanctions.

Just last month CNN reported that a Turkish official had revealed that Iran was asking for payments in gold for gas supplies to Turkey. "Over the last six months, Iran has evaded U.S. sanctions by importing Turkish gold to pay for billions of dollars worth of energy sales to Turkey," CNN reported.

"Why did, all of the sudden, Turkey's gold exports, especially gold bullion, go up?" Ali Babacan asked while speaking before a parliamentary budget commission in November. The official transcript of his statements was published by a Turkish government website Wednesday.

"An important part of that is Iran," he said. "When Turkey buys Iranian oil, we pay for it in Turkish lira... However, it is not possible for Iran to take that money as dollars into its own country due to international restrictions, the U.S.A.'s sanctions. Therefore, when Iran cannot take this money back as currency, they withdraw Turkish lira and buy gold from our market. They take the gold back to their own country."

Now it seems that gold has found its way into Iraq's reserves possibly in lieu of US dollars to the starved Iranian regime's economy.

New US sanctions against Iran target just such gold trading and will pressure the Iranian regime in its cat and mouse game of evading sanctions against it due to its abhorrent policies.

http://www.ncr-iran.org
© 2012, Assyrian International News Agency. All Rights Reserved. Terms o

2Iraq has boosted its gold reserves Empty Re: Iraq has boosted its gold reserves Mon Dec 24, 2012 12:37 am

windreader1



Financial Times

December 21, 2012 4:31 pm

Iraq boosts gold reserves
by 25 tonnes

By Javier Blas in London

Iraq has joined the growing list of countries buying gold for their official reserves, purchasing more than 25 tonnes of the precious metal in the market to beef up the gold reserves of its central bank for the first time in years.

The purchases by Baghdad come as Iran is using gold as a currency to settle import-export transactions with neighbouring countries, including Turkey. But Iraq has so far not disclosed any gold transaction with Tehran.

Analysts said it was unclear whether the purchases showed dealings with Iran, or were simply a sign that the Iraqi central bank is diversifying its foreign exchange reserves, as others in emerging countries have done recently.

Iraq joins countries from Russia to Brazil in buying gold to diversify its official reserves this year. According to data released late on Thursday by the International Monetary Fund, Iraq bought gold during August-September, lifting its official precious metals reserves from 5.8 tonnes to 31.07 tonnes.

The so-called official sector - a group that includes central banks, sovereign wealth funds and other quasi-government entities - has been a significant buyer of gold since 2010, having been a strong seller in the previous 15 years.

The Iraqi additions are among the biggest officially reported so far this year, behind only Russia, Turkey and Kazakhstan. Some countries have bought gold secretly in the past, including China, disclosing their purchases years later.

The purchases have lifted Iraq in the global ranking of gold holders from 78th to 54th position, according to data from the World Gold Council, the lobby group of the gold industry. Iraq is the first buyer of gold in the Middle East region that has acknowledged its purchases, although the market suspects Saudi Arabia and several regional sovereign wealth funds have also bought gold in the past.

“Having a new buyer in the central bank space, and especially from a new region, is an important development,” said Joni Teves at UBS in London.
Gold has been trading in a relatively narrow band of between $1,500 and $1,800 per troy ounce for the past year. Over the past week, spot gold prices in London fell 2.5 per cent to $1,651 per ounce. On Thursday, gold prices briefly hit their lowest since August, trading at $1,635 per ounce on the spot market.

Weak physical demand, particularly from India and China, has weighed on the gold market for most of the year, analysts said. The weakness from the jewellery sector is so far offsetting bullish financial factors, including ultra-low interests rates in major economies and the worries about the so-called fiscal cliff of automatic tax increases and spending cuts in the US.

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