Venezuela nears deal to move US$4bil gold reserve to New York

CARACAS: The Venezuelan government and the opposition are reportedly nearing an agreement to transfer $4 billion worth of the country's gold reserves from the Bank of England to the Federal Reserve Bank of New York, according to a report by the Financial Times. The gold, held in the Bank of England's vaults for years, is currently under the control of the interim government led by Delcy Rodriguez.

However, the agreement stipulates that the government would not be able to sell the gold immediately. Instead, the reserves could serve as collateral for government borrowings, including funds for reconstruction following the earthquakes that hit the country in June. The British Foreign Office spokesperson clarified that the UK government is not involved in the legal proceedings determining who should control the Venezuelan gold, stating that both the UK courts and the Bank of England are separate from government authority.

The BoE has expressed that it cannot proceed until a further order from the UK court establishes the legal authority over the account. If the deal is finalized, gold could potentially be employed to combat inflation in Venezuela.