Venezuela using alternative method to appraise gold reserves

early in May, seeking to curb the impact of falling prices on the country’s international reserves, the board of directors of the Central Bank of Venezuela (BCV) decided to change the method that had been used to appraise the value of Venezuelan gold bullion. So, rather than appraising Venezuelan gold (11.76 million ounce) based on the average recorded by the London gold market in the common two-month term, Venezuela is using a six-month term basis. Nevertheless, despite the efforts made by the BCV, gold price has continued falling, and by the first half of 2012 Venezuelan gold was worth USD 1,651.18 per Troy ounce versus USD 1,696.33 in the same term in 2011.Such decline implies a 2.6% drop in Venezuelan gold reserves, standing at USD 19.4 billion. If gold price fails to rebound, growth in Venezuelan international reserves will depend on oil revenues only. Read Article