by Ronan Manly
Bullion Star
As the gaping spread between London (LBMA) spot gold prices and front-month COMEX gold futures prices persists for a sixth week triggered by the bullion bank EFP liquidity blow up on Monday 23 March 2020, one unappreciated aspect of this gold price discovery scandal is that daily London LBMA Gold Price auctions are deliberately ignoring COMEX gold prices when setting the Opening Price (starting price) in the twice daily gold price auction.
Ignoring the Obvious
By ignoring the much higher COMEX gold futures prices while setting the LBMA gold auction starting price, the auction administrator IBA is ignoring current market conditions in the gold market (note – a stated methodology of the auction is to use current market conditions).