In a joint press release, the International Enterprise Singapore, the Singapore Bullion Market Association, the Singapore Exchange and the World Gold Council said the contract, the first of its kind to be offered globally, underpins the creation of a centralized kilobar gold market, characterized by real-time transparent price discovery, daily expiration with physical delivery and robust verification of quality gold.
The launch will also be a significant step towards establishing Singapore as a regional precious metals trading hub, they added.
The contract is based on kilobar gold of at least 99.99% fineness of an approved brand, attested by the gold delivery agent, freshly minted from an approved refinery from a SBMA gold delivery list, packed and sealed by the approved vault operator in tamper-evident boxes, each containing 25 bars of a single approved brand.
Trading in gold has soared in Singapore after the Government exempted investment precious metals from the Goods and Services Tax (GST) in Oct 2012.
Prices for the precious metal’s immediate delivery is heading for the first quarterly loss this year as prospects for higher U.S. interest rates reduce the appeal of the metal as a store of value. The metal traded at $1,219.58 an ounce by 4:19 p.m. in Singapore, set for an 8.1% drop since the end of June.
