(Bloomberg) – US President Joe Biden and the leaders of the Group of 7 will agree to announce a new ban on gold imports from Russia, a person familiar with the plan said, the latest sanctions are in response to Russian invasion of Ukraine.
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The person said the leaders would reveal the joint commitment at a summit in Germany starting on Sunday, speaking on condition of anonymity before making a public announcement. The ban will apply for the first time on gold leaving Russia for G-7 countries. The US Treasury Department will issue the ban on Tuesday, banning US imports, the person said.
While Western sanctions aimed at punishing Russia have closed most of the European and American markets to gold from the world’s second-largest gold miner, the G-7 pledge would mark a major cut. complete break between Russia and the world’s two leading commercial centers, London and New York.
“What this does is formalize what the gold industry has done,” said Adrian Ash, head of research at brokerage firm BullionVault.
The London Bullion Market Association, which sets standards for that market, has removed Russian gold refineries from its accredited list. Shipments between Russia and London have almost dropped to zero since the invasion of Ukraine.
According to UN Comtrade data, London is one of the most important destinations for Russia’s precious metals: $15 billion in Russian gold went there last year accounting for 28% of total UK gold imports.
An executive order signed by Biden on April 15 prohibits U.S. people from engaging in gold-related transactions involving Russia’s central bank, the country’s National Financial Fund, or the Treasury Department. its main.
While refineries could theoretically still import gold directly from Russia, most refiners have sworn to do so. The Swiss Refiners Association, which dominates the industry, denied its members bought gold from Russia after trade data showed the country’s gold had entered the country.
The outflow of other metals from Russia such as copper, nickel and palladium continues as the commodities industry grapples with managing a long relationship with a major world supplier of raw materials.
Meanwhile, the Russian gold industry is looking for new sales options, such as exporting more to China and the Middle East, which are not part of the G-7.
(Updated with gold analyst comment in fourth paragraph.)
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