Italy government

Italian government won’t sell ‘a gram’ of gold reserves: League lawmaker

ROME (Reuters) – The Italian government has no plans to sell the Bank of Italy’s gold reserves to plug budget holes, a senior lawmaker from the ruling League party said on Wednesday.

“We don’t want to sell a gram (of gold),” said Claudio Borghi, chairman of the budget committee of the lower house and economic spokesman for the League, in an interview with public television RAI.

The League drafted a bill that would eventually allow the government to sell the country’s gold reserves if there was also a change in the constitution – a long and complicated legislative process.

Borghi has already tabled a bill to establish that gold is owned by the state rather than the Bank of Italy, a point that is disputed in Italy.

The idea that Italy could sell off some of its gold reserves to fill budget deficits has sparked outcry in Germany, Daniel Gros, a German economist and director of the Center for European Policy Studies, said on the same show. televised.

In an exchange with Borghi, Gros added: “Some conservative financial circles believe that Italy is on the verge of collapse and see its gold reserves as the only available guarantee in the event of a bailout.”

Italy is the third largest holder of gold reserves in the world, behind the United States and Germany, with 2,451.8 tons last year, according to the World Gold Council.

In 1976, 543 tons of gold bars were used by the Bank of Italy as collateral for a German central bank loan.

Reporting by Giselda Vagnoni; Editing by Valentina Za and Steve Scherer, Editing by William Maclean