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UPDATE 1-Philippine c.bank to begin trading in gold to keep at around 10% of reserves

Published 09/05/2020, 05:11 PM
Updated 09/05/2020, 05:20 PM
© Reuters.
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(Adds more comments from cbank governor, background)
MANILA, Sept 5 (Reuters) - The Philippine central bank will
shift from passively holding gold to actively trading the
precious metal with the aim of keeping it at around 10% of total
international reserves, its governor said on Saturday.
The Philippine's reserves totalled $98.6 billion as of the
end of July, with gold accounting for 13%, thanks to an increase
in international bullion prices, and giving the central bank an
opportunity to sell some of its gold.
Bangko Sentral ng Pilipinas Governor Benjamin Diokno said
the monetary authority plans to maintain an "optimal" ratio of
gold to total international reserves, which studies say should
be at 10%.
"The Monetary Board decided to shift from passive to active
trading largely because of the change in the price dynamics of
gold," Diokno told reporters in a phone message. He said the
central bank was not trading gold earlier.
Gold XAU= broke above $2,000 per ounce in August, making
the precious metal one of 2020's best performing mainstream
assets.
Diokno was elaborating on remarks he made on Friday, when he
revealed the central bank was considering selling gold to bring
down the ratio to 10%, and keep it there.
The bank "will always be opportunistic in its reserves
management," Diokno said.


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