MOSCOW EXPECTED TO FORM GOLD EXCHANGE BY YEAR'S END

MOSCOW EXPECTED TO FORM GOLD EXCHANGE BY YEAR'S END

The Russian government is planning to set up a gold exchange in Moscow before the end of the year, a spokesman for the Russian State Committee for Precious Metals (Roskomdragmet) said Monday.

Although the documents authorizing the opening of the exchange have not been signed yet, this is likely to happen very soon because the government is concerned with the slow development of the domestic gold and precious metals market, he said.Russian gold-producing regions are allowed to dispose of up to 10 percent of the metal they extract on the domestic market. They have accumulated sufficient reserves to necessitate the creation of a gold exchange in the country.

Both state and private companies licensed to trade gold and precious metals will operate on the new exchange. Also, since the recent issue of ''gold loan" state bonds (more than 1 trillion rubles backed by 100 metric tons of gold out of the federal gold reserve), a limited number of state and private banks may be allowed to conduct operations with gold on the domestic market.

The spokesman said Roskomdragmet estimates gold production in Russia this year at 140 tons to 145 tons, about the same as last year.

The total federal gold reserve was a little more than 330 tons at the beginning of July.