Singapore's monetary authority has opened its national currency vault, with room for 500 tons of bullion, to foreign central banks and sovereign entities. Private investors already store gold there, but analysts quoted in the report say storage alone does not make a bullion market.
The Monetary Authority of Singapore opened its national currency vault, with room for 500 tons of bullion, to foreign central banks and sovereign entities on Tuesday. It also added a tax break for the wholesale gold trade. At roughly $4,050 an ounce, 500 tons is about $65BN of gold.
A central bank runs the new vault
The facility differs from Singapore's private vaults because the central bank itself operates it, giving foreign monetary authorities a sovereign custodian in Asia alongside the Bank of England and the New York Fed. The vault will hold reserves for foreign central banks, international financial institutions and sovereign entities. Meanwhile, the MAS will open gold custody accounts for selected Singapore-based bullion banks.
Some central banks have already expressed interest, but Deputy Prime Minister Gan Kim Yong would not say which, since the talks are confidential. Tax relief on gold will extend to wholesale services between institutions from April 2027. An SGX over-the-counter clearing system is due by year-end, with live trading expected by March 2027 and deliverable kilobar futures in the second quarter.
Private holdings passed 800 tons
Wealthy investors moved first. Bloomberg reported that privately held gold in Singapore has grown 16-fold since 2014 to more than 800 tons. Bullion dealer J. Rotbart & Co. says web inquiries from Western clients have tripled in a year, led by the US.
OCBC says holdings at its private bank are up more than 40% since the end of 2025. Gauld says about 40% of its European clients have moved some gold from Switzerland to Singapore or picked it for new purchases.
A vault is not yet a market
Singapore imported 171 tons of gold through August, up 44% on the year, while London has nearly 60 times that in storage. Metals Focus managing director Nikolas Kavalis told CNBC that the sovereign vault is an important addition, but storage alone does not make a bullion market.
The launch also comes as gold trades around $4,050, below January's record just under $5,600. Goldman cut its target again last week, to $4,150 for year-end and $4,800 for end-2027.
The next test for the market comes Friday, with October central bank buying data.
Source: Oilprice.com
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