Singapore expands gold market push with central bank vaulting service

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Singapore expands gold vault service

Highlights

Monetary Authority of Singapore will launch a central bank vaulting service for up to 500 metric tons of bullion, targeting foreign central banks and institutional entities.
From April next year, Singapore will extend tax relief for gold to wholesale institutional services, including vaulting, refining, recasting, assaying, and broking.
Singapore plans to launch an OTC gold clearing system by end-2024, with live trading by March 2027 and SGX gold kilobar futures in Q2 2027, enhancing regional market liquidity.

Vaulting service and tax framework

As reported by Reuters, citing the Monetary Authority of Singapore, the central bank will launch a vaulting service to hold bullion reserves on behalf of foreign central banks, international financial institutions and sovereign entities in Singapore's national currency vault. The facility has capacity for 500 metric tons and is part of a broader effort to deepen Singapore's role in the gold market.

Deputy Prime Minister Gan Kim Yong, who is also trade and industry minister and chairman of MAS, says developing the gold market extends Singapore's role as a trusted financial centre. He also says central banks are seeking more options to strengthen resilience as demand for gold as a reserve asset grows, adding that MAS has received confidential expressions of interest.

MAS and the Ministry of Finance also plan to introduce a new tax framework from April next year. The move would extend tax relief for gold to wholesale services between institutional participants, including vaulting, refining, recasting, assaying and broking.

Regional competition and market buildout

Singapore is rolling out the measures as it competes for a larger share of precious metals trading in Asia. MAS says the combined steps are intended to support deeper market liquidity, improve price discovery and risk management during Asian trading hours, and strengthen Singapore's links to established gold centres and global liquidity.

The city-state is also preparing to launch an over-the-counter gold clearing system by the end of the year, with live trading and market operations expected to begin by March 2027. MAS says gold market liquidity is expected to build through 2027, while SGX's physically deliverable gold kilobar futures are targeted for launch in the second quarter of 2027.

The strategy unfolds as other regional hubs also seek a stronger foothold in bullion markets. In Hong Kong, the government is pushing to expand bullion storage and develop the city as an international gold trading centre.

Earlier, we reported that S&P Global Ratings warned geopolitical tensions and elevated fiscal spending are raising sovereign borrowing risks as funding costs stay high.

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