Economy, Business And Markets

Repatriated Gold Worth $700m

Repatriated Gold Worth $700mRepatriated Gold Worth $700m

The 13 tons of gold repatriated to the Central Bank of Iran is worth $700 million, said the bank’s governor Valiollah Seif.

USA Today had put their estimated value at $485 million based on international prices. By Financial Tribune’s calculations, the gold would be worth $535.89 million at Saturday’s $1168 an ounce spot price in commodity markets. It is possible that the governor was valuing the gold based on its purchase price.

Bullion for immediate delivery has come down from an all-time high of $1903 in September 2011, to $1131 in October 2014.

The 13 tons could have been purchased any time after the intensification of sanctions in 2010. So, the price the Iranian central bank paid for the gold and the mode of purchase remains unknown.

The governor confirmed on Wednesday that the CBI had received 13 tons of its bullion blocked by sanctions against the bank. The central bank was unable to transfer the gold, but the issue was resolved on the sidelines of the ongoing nuclear talks in Vienna.

Iran is negotiating with the five original nuclear members of the United Nations Security Council—the US, Britain, France, Russia and China—plus Germany on a deal to lift international sanctions in return for limits on Tehran’s nuclear energy program. Negotiators extended a Tuesday deadline for another week and are now seeking a deal by July 7.

Apart from the 13 tons, “eight tons of gold worth $400 million have been bought and brought into Iran in the past two years,” said Seif.

The relief provided by the world powers helped the central bank stabilize Iran’s foreign exchange market. The rial lost 70% of its value after the intensification of sanctions. The stabilization of the rial is one of the main factors behind the 22 percentage point fall of inflation in 2014.