The rush to STOCKPILE gold in New York leads to London SHORTAGE!
A surge in gold shipments to the US has led to a shortage of bullion in London, as traders amass an $82bn stockpile in New York over fears of Trump administration tariffs.
The wait to withdraw bullion stored in the Bank of England’s vaults has risen from a few days to between four and eight weeks, according to people familiar with the process, as the central bank struggles to keep up with demand.
“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. “Liquidity in the London market has been diminished.” The BoE declined to comment.
Since November’s US election, gold traders and financial institutions have moved 393 metric tonnes into the vaults of the Comex commodity exchange in New York, driving its inventory levels up nearly 75 per cent to 926 tonnes, the highest level since August 2022.
Total gold flows into the US could be far higher than the Comex numbers reflect, according to market participants, because there are likely to have been additional shipments to private vaults in New York owned by HSBC and JPMorgan. The two banks declined to comment.
Traders say the shipments are intended to avoid tariffs on bullion that some fear could be introduced by US President Donald Trump.
“There is a feeling that Trump could go across the board and impose new tariffs on raw materials coming into the US, including gold,” said Michael Haigh, head of commodities research at Société Générale. “There is a bit of a scramble among participants in the gold market to protect themselves.”
The shipments are also the result of higher prices on the futures exchange in New York than in the cash market in London. The unusual arbitrage opportunity has incentivised traders to send the metal across the Atlantic.
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Trump has yet to spell out his trade policy and has not specifically mentioned a duty on bullion, although he has threatened to impose wide-ranging tariffs on US imports.
Gold prices have risen 5 per cent since the start of the year, and are just $30 shy of their all-time record of $2,790 per troy ounce set in October.
London and New York are two main global markets for trading, with most physical trading taking place in the UK, while the futures market is in the US.
Many market participants compare the current US gold rush with the situation during the Covid pandemic, when lockdowns and uncertainty over shipments of gold trigged a surge in stockpiling on Comex.
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