Singapore to set up OTC gold clearing system by end-2026

This forms part of Singapore’s push to strengthen its role as a trusted gold trading and storage hub in Asia.

Singapore will establish an over-the-counter gold clearing system by the end of 2026, as part of efforts to strengthen its position as a trusted node for gold trading, clearing, settlement, and storage in Asia.

Deputy Prime Minister Gan Kim Yong said the system, which will be established by SGX for Loco Singapore, will support both large bars and kilobars, enabling standardised settlement during Asian trading hours. Interbank trading is expected to build from 2027.

Six bullion banks — DBS, Deutsche Bank, ICBC Standard Bank, J.P. Morgan, OCBC, and UOB — will participate as clearing members under a memorandum of understanding with SGX. They will work with the exchange to develop the Loco Singapore gold market, deepen price discovery, and build trading activity.

Gan said the initiative will help address a gap in Asia’s gold market infrastructure, where demand has grown but trading, liquidity, and price discovery remain concentrated in established centres such as London and New York.

Asia accounts for about 70% of annual consumer gold demand, with China and India among the top contributors to bar and coin demand in 2025. Southeast Asian markets, including Thailand and Vietnam, are also active.

“We are not seeking to replace established centres of gold trading and liquidity,” Gan said. “Instead, Singapore can serve as a trusted node in the global gold ecosystem — connecting regional demand with global liquidity, and supporting market activity during Asian hours.”

The Monetary Authority of Singapore (MAS) will also introduce central bank gold vaulting services by October 2026. This will provide foreign central banks and sovereign entities with a secure option to store their gold reserves in Singapore.

Singapore already has more than 2,000 tonnes of commercial vaulting capacity, serving bullion banks, institutional investors, and high-net-worth investors. MAS’s vaulting services will complement this existing commercial capacity.

MAS will also extend gold accounts to selected Singapore-based bullion banks, allowing them to provide gold-related services and liquidity to foreign central banks and sovereign entities that may want to actively manage their gold holdings.

Meanwhile, SGX is exploring a physically deliverable gold futures contract to enhance price discovery and risk management. Banks are also looking into the use of tokenised gold in Singapore, including through collaboration on the Gold Bar Integrity initiative by the World Gold Council and the London Bullion Market Association.

MAS will also remove the 5% cap on physical investment in precious metals under tax incentive schemes for funds. This will allow eligible funds and family offices to diversify their portfolios more flexibly and support greater capital deployment into physical gold in Singapore. Further details will be released by September.