ICE launches new gold clearing option

Intercontinental Exchange, an operator of global exchanges and clearing houses and provider of data and listings services, reports

(a) the introduction of central clearing for the IBA Gold Auction which underlies the LBMA Gold Price that is planned to go live in March 2017, and (b) the launch of a new London gold daily futures contract in February 2017, subject to regulatory review. It says the contract will be for Loco London gold (which refers to gold bullion that is physically held in London).

“We are pleased to introduce central clearing for the gold auction underlying the benchmark LBMA Gold Price,” said Finbarr Hutcheson, President, ICE Benchmark Administration. “The number of participants in the LBMA Gold Price has grown from four to 13 since we launched last year and we continue to see strong demand from other firms, which we believe the introduction of central clearing will further support. This growth demonstrates the continued importance of the LBMA Gold Price and its international role as the world’s most trusted benchmark price for gold.”

ICE says central clearing will be enabled by a new physically settled, Loco London gold daily futures contract that will trade on ICE Futures US (IFUS). It is designed to complement the existing London market, being based on the LBMA Good Delivery Rules.

The ICE Gold Daily Future will be a physically settled, daily contract, traded in one cent ($0.01) increments, that calls for delivery of one hundred fine troy ounces of unallocated Loco London gold of quality satisfying the LBMA Good Delivery Rules.