Russia To Begin Trading Gold On St. Petersburg Exchange.

Russia, the world’s second-largest gold producer, is to free itself from the current dependence of gold prices on the London Stock Exchange (LSE), and plans to launch gold trading on the St. Petersburg Exchange (SPIMEX) by the end of the year. One of the main objectives of the exchange when launching a new market is to ensure the formation of representative indicators of a competitive market price. Until recently, gold market participants relied on price benchmarks set by the LSE. Now, the LSE will face competition.

We noted the gradual movement away from Western-based trading and research facilities with the Russian establishment of the Institute of Oil & Gas Initiatives which is partially designed to be a competitor to the American Petroleum Institute. In this case, the United Kingdom doesn’t produce any gold, whereas Russia has significant reserves of the metal.

However, London does have a massive repository for foreign gold, as has New York, but it doesn’t own, apart from the UK’s own reserves, most of this stock. However, this gold is literally under arrest as soon as any country tries to claim sovereignty over its own gold as the UK typically makes it difficult to transfer stocks.

It is expected that St. Petersburg will offer spot gold trading in the form of bars (one lot per bar). At the first stage, it is planned to launch trading in two types of bars: 1-kilogram bars and 12-kilogram standard (bank) bars. Subsoil users, refineries, banks, and industrial enterprises that purchase precious metals for or the production of industrial products (jewellery, catalysts, etc.) will be able to participate in the trading of precious metals.

Source: Russiaspivottoasia