London bullion body could charge more or disband gold rates
In July, the International Organisation of Securities Commissions (IOSCO) – a global umbrella group for market regulators – detailed a series of principles on financial benchmarks, after the Libor (London Interbank Offered Rate)manipulation scandal.
The scandal led Madrid-based IOSCO to study how Libor, which was rigged by British banks, including Barclays <BARC.L>, and other money market benchmarks should be supervised and how they are set, to restore market confidence.
Libor is the estimated interest rate set daily by leading London banks at which they would be charged when borrowing from other banks.
The GOFO rate is the gold equivalent to Libor, at which dealers will lend gold on swap against U.S. dollars.
“Going forward, the GOFO service has to conform to some principles, therefore we have to look at how the data is collected, how it’s recorded, who is administrating it,” LBMA Chairman David Gornall told Reuters in an interview.