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Gold reserves in London vaults rose in March, according to LBMA

London Bullion Market Association said that the gold in London vaults at the end March totalled 8,488 metric tonnes, an increase of 0.1% over the previous month. Outflows from London into New York slowed after the dislocation.

Last week, the premium between London gold spot prices and most active Comex futures contracts on Comex decreased after Washington exempted precious metals from U.S. import duties.

Market players increased their gold deliveries to the U.S. in order to protect themselves against Washington's possible imposition of tariffs on the import of the metal between December and March.

Comex gold stock levels are at record heights, after increasing by $80 billion in the last few months since Donald Trump announced that he would impose tariffs against imports from Canada or Mexico.

Additional stocks were sourced from Switzerland and London, which is the largest OTC gold trading hub in the world. This reduced liquidity on the London market.

The London bullion markets were compelled to borrow gold from the central banks that store their bullion at the Bank of England vaults. This created a long queue of people waiting to receive the metal.

"While gold stocks at London's commercial vaults increased this month, stocks in Bank of England decreased by a similar rate to February," LBMA reported.

Sources familiar with the situation told us last week that the waiting period to remove gold from the BoE vaults was reduced to 2-3 weeks by late March, compared to 4-6 weeks during January. After a sharp rise in January and February, the gold lease rates in London have returned to normal in late March.

LBMA reported that there were 22,127 tonnes of silver in storage for March, a drop of 1.5% compared to February. The decrease in silver held by the LBMA slowed down from 4.5% in February. (Reporting and editing by Tomasz Janovski and Susan Fenton.

(source: Reuters)