What the law says

The Bank of Italy’s gold bullion forms part of the official foreign exchange reserves, which are held under the terms of the Treaty on the functioning of the European Union and of the Statute of the European System of Central Banks (ESCB) and European Central Bank (ECB): storing and managing the official reserves are among the fundamental tasks of the Eurosystem, which consists of the ECB and the central banks of Eurozone countries. The national central banks manage their foreign exchange reserves in complete independence but within the guidelines set by the ECB to safeguard the single monetary policy. Gold bullion is specifically included in the definition of ‘foreign currency reserve assets’ in the EU regulations issued in implementation of Article 30 of the ESCB’s Statute and governing their transfer from NCBs to ECB.

According to Article 7(2) of Italian Legislative Decree 43/1998 on the Bank’s participation in the ESBC, ‘the Bank of Italy shall be responsible for the management of the official reserves in compliance with the provisions of Article 31 of the Statute of the European System of Central Banks and European Central Bank’. The Article replaces the earlier Article 4(2) of the Consolidated Law on Foreign Exchange Regulation, approved by Decree of the President of the Republic DPR 148/1988, under which the official foreign exchange reserves were managed by the former Italian Foreign Exchange Office (UIC), as well as by the Bank of Italy for the part relating to ordinary foreign exchange market transactions and those associated with international commitments. The new article became necessary after the single currency was introduced and only Eurosystem central banks were allowed to hold and manage official foreign exchange reserves. Article 15(2) of DPR 148/1998 already authorized the Bank of Italy to trade gold bullion abroad without restriction ‘as part and within the limits of its reserve management duties’.