03:36 GMT16 May 2021
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    The Central Bank of Venezuela has entered into talks with Wall Street bankers seeking to monetize up to $1.5 billion of its gold reserves, sources say.

    The Central Bank of Venezuela (BCV) has entered into talks with Wall Street banks seeking to monetize up to $1.5 billion of its gold reserves in order to bolster the country's shrinking economy, sources say.

    BCV is planning to create a gold swap providing its contractor party with 1.4 million troy ounces of gold in exchange for cash, media sources report, citing an unnamed central bank source. After four years, BCV would have the right to buy the gold back. Reportedly, at least two financial institutions, Bank of American and Credit Suisse, are currently involved in the ongoing negotiations.

    Cuba vows to support Venezuela after the United States decided to impose new sanctions against several individuals in Caracas.
    © REUTERS / Miraflores Palace/Handout via Reuters
    "Work is being done to complete this operation toward the end of April," according to another source, close to Venezuela's Ministry of Finance.

    The move would help Venezuela survive the severe cash crunch that has wrought turmoil in the country, which was caused by sharp decline in oil prices and heavy debt payments. The OPEC nation is currently suffering from higher consumer prices, product shortages and a rapidly shrinking economy.

    However, neither the Central Bank of Venezuela, nor the aforementioned banks have yet confirmed the information.

    It is worth mentioning that up to two-thirds of Venezuela's reserves are held in gold: the country's former leader Hugo Chavez converted most the of state's dollar assets into physical gold in the wake of the world financial crisis of 2008.


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    monetization, gold reserves, Central Bank of Venezuela, Credit Suisse Group AG, Bank of America, Venezuela
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