Zee Media Bureau
Gold prices may see steep decline in the coming days as Swiss voters overwhelmingly rejected proposals on Sunday to boost gold reserves.
The "Save our Swiss gold" initiative, proposed by the right-wing Swiss People`s Party out of concern the central bank has sold too much of its gold in the past, was rejected by 77 percent of voters, said Swiss broadcaster SRF.
The measure would have compelled the Swiss National Bank (SNB) to boost its gold reserves to 20 percent of its assets from around 8 percent currently, and banned it from ever selling the metal, threatening its ability to defend a 1.20 euro cap on the Swiss franc imposed at the height of the euro crisis.
The SNB welcomed the result with the refrain that it would continue to defend the cap, buying unlimited quantities of foreign currency and take further measures immediately, if necessary.
"We anticipate a short-term sell off in gold, although a no vote was mostly priced in," said Peter Rosenstreich, an analyst at Swissquote.
Meanwhile, gold fell more than two percent at one point to USD 1,142.90 per ounce, its lowest level in more than three weeks.
With agency inputs
