Overview

• The ECB’s latest Financial Stability Review cautions that a sudden gold price drop could trigger margin calls and liquidity shortages across global markets.
• Gold derivatives now account for roughly $1 trillion in Europe—triple the annual physical production—far outpacing bullion holdings and ETFs.
• Physical delivery demands surged after President Trump’s tariff announcements, creating supply bottlenecks and a temporary $50 per ounce price gap between London and Chicago.
• Bullion banks like JPMorgan and HSBC face delivery shortfalls on gold futures, raising the risk of insolvencies if they cannot secure enough metal.
• The ECB is calling for greater transparency and tighter oversight of over-the-counter gold contracts to mitigate systemic threats