FT Reports: Gold Shipments to U.S. Strain London’s Bullion Market
Gold Moves to New York Amid Tariff Concerns
Gold Shipments to U.S. Strain London’s Bullion Market
The FT reports on London’s Gold scramble. Here is our coverage of that story
Gold Moves to New York Amid Tariff Concerns
A surge in gold shipments to the U.S. has tightened supply in London as traders build an $82 billion stockpile in New York. Fears of potential tariffs under the Trump administration are driving the rush, according to market sources.
Delays at the Bank of England
The wait time to withdraw gold from the Bank of England has stretched from a few days to four to eight weeks as demand overwhelms the central bank’s capacity. “People can’t get their hands on gold because so much has been shipped to New York, and the rest is stuck in the queue,” said one industry executive.
Gold Inventories Surge at COMEX
Since the U.S. election, 393 metric tonnes of gold have moved into COMEX-approved vaults, pushing inventories up 75% to 926 tonnes—the highest since August 2022. Market participants suggest actual U.S. inflows may be even higher, with additional shipments likely going to private vaults owned by HSBC and JPMorgan.
Tariff Speculation Drives Market Moves
While Trump has not explicitly mentioned gold tariffs, traders are acting preemptively. “There is a feeling that Trump could impose new tariffs on raw materials, including gold,” said Michael Haigh, head of commodities research at Société Générale. The premium on COMEX futures over London spot prices has also incentivized traders to shift metal to New York.
Historical Comparison to COVID-Era Stockpiling
The rush mirrors the COVID-era gold movement when lockdowns disrupted supply chains, triggering a surge in stockpiling at COMEX. Traders now seek access to gold to fulfill futures contracts, further tightening London’s available supply.
BoE Downplays Impact
BoE Governor Andrew Bailey dismissed concerns about extended withdrawal times, emphasizing that London remains the world’s primary gold market. “If you want to trade or use your gold, you need to have it in London,” he told the UK’s Treasury Committee.
Market Impact
Gold prices have climbed 5% year-to-date, nearing their all-time high of $2,790 per troy ounce. Last week, June COMEX gold contracts traded at a premium of $60 per ounce over London prices, though the gap has since narrowed to $10 as shipments reached the U.S.
Uncertain Outlook
Joe Cavatoni of the World Gold Council noted that while traders are bracing for tariffs, there’s no clear indication that the administration will target monetary metals. “We are not getting a sense from the rhetoric that they intend to go after bullion,” he said.
FT story below