The mechanism for setting the gold-price benchmark must be reformed to restore faith in the market, the industry body for the precious metal said Monday.
But members of the World Gold Council, which convened in London for talks on overhauling or even replacing the price benchmark, appeared not to have reached an agreement.
“There was no real view from anyone in the room that the gold fix should be abandoned and we should start redesigning it from scratch,” WGC managing director Natalie Dempster told Reuters.
Dempster said in a statement earlier the industry was at the start of a process that “will lead to a reformed and modernized gold benchmark which attracts a broader range of market participants.”
Those taking part in Monday’s WGC meeting included exchanges, central banks, bullion banks, mining companies, refiners, traders and other industry groups. Britain’s Financial Conduct Authority (FCA) watchdog observed the proceedings, the results of which could move the gold price higher.
The current gold-price fixing process, initiated in 1919, affects billions of dollars in gold trading around the world daily. It involves the benchmark being set via teleconference in the morning and afternoon each day by the Gold Fixing Company, which consists of four banks.
The four are Barclays, HSBC, Societe Generale and Scotiabank. Deutsche Bank used to belong to the panel but quit earlier this year.
The fix came under fire in May, when the FCA fined Barclays about U.S.$44.5 million (26 million pounds) in connection with one of its ex-traders having admitted to trying to manipulate the price of gold.
Critics describe the so-called “London fix” as old-fashioned and ripe for abuse.
Last week, the WGC suffered a blow when two top South African miners, Gold Fields (NYSE:GFI) and AngloGold Ashanti (NYSE:AU), said they would not renew their memberships.