Report: Germany plans to do a Chavez and bring home its gold

UPDATED: Bundesbank confirms it's bringing back 674 tonnes of gold >>

Handelsblatt newspaper reports – following rumours to the effect that have been circulating for months – that Germany’s central bank will recall much its gold bullion stored in vaults around the world.

The Bundesbank is holding a news conference Wednesday morning where according to the paper it will announce a reshuffle of where it keeps its more than $180 billion worth of gold.

At the moment the US Federal Reserve stores 45% of the total 3,396 tonnes in Manhattan and some reports suggest that the Bundesbank want much of it back because the Fed refused German officials a viewing of the bullion a couple of months ago.

The Bank of England has 13% in London and the Bank of France in Paris 11% while the remainder is held at the Bundesbank's headquarters in Frankfurt.

MarketWatch quotes Thorsten Polleit, Frankfurt-based chief economist at Degussa, a precious-metals firm, as saying Germans have long been demanding "an audit of the German gold reserves and repatriation of those reserves. Some fuel was thrown on that fire in the last year by the financial crisis":

“People have gotten a sense of how bad things could become and gold is the ultimate means of payment. The euro won’t last forever, [and] gold, for various reasons, is the anchor,” said Polleit.

In November 2011, Venezuala repatriated some 180 tonnes of gold held in vaults in London and elsewhere to store it with the Caracas central bank under orders from President Hugo Chavez.

Gold futures were last quoted at $1,679 an ounce in New York, up $10 on the day.