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Former unit of account
The
gold franc
(currency code: XFO) was the unit of account for the
Bank for International Settlements
from 1930 until April 1, 2003.
[1]
It was replaced with the
special drawing right
.
[2]
It was originally based on the
Franc Germinal
, and remained at the value the franc was pegged (0.290322 g fine gold) after the countries of the
Latin Monetary Union
came off the gold standard.
[3]
Use in New Hebrides
[
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]
The gold franc was used in the Anglo-French Condominium of the
New Hebrides
(now
Vanuatu
) as the currency in which the joint administration's postal service denominated its stamps, a natural choice as the Universal Postal Union Treaty (beginning in 1874 when the first treaty was agreed and reaffirmed at subsequent Congresses until at least that of 1939?see the various "Actes du Congress
[4]
...") denominated the agreed international postal rates in gold franc and gold centime leaving each member country and its dependencies to translate the amounts into their own currencies. This added to the already confused situation in which the Australian dollar and the
New Hebrides franc
were used in normal trade (and in which even the
pound sterling
turned up in the columns of earlier joint administration budgetary documents).
Swiss Gold Franc Initiative
[
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]
On March 9, 2011, a parliamentary
initiative
was introduced in the
National Council of Switzerland
to institute a gold franc as additional currency for
Switzerland
:
The Confederation institutes an official gold franc with a set of coins of different denominations, each having a fixed gold content. It regulates the concessions granted to the licensees authorized to mint coins; minting coins is not taxable.
[5]
This initiative was examined by the
Committee for Economic Affairs and Taxation
, which rejected it at the June meeting.
This gold franc would have been defined as 0.1
gram
of fine
gold
.
[6]
The initiative would not have removed, replaced or pegged the existing Swiss franc, therefore both the gold franc and the Swiss franc would have coexisted side-by-side. Due to the fixed metallic content of the gold franc, its exchange rate with the Swiss franc would have gone up and down according to market supply and demand, like any other free-
floating currency
.
The gold franc was intended to become a
safe-haven currency
, to divert international capital flows in times of
financial crises
away from the Swiss franc.
[7]
The gold franc would have been completely independent from the gold reserves of the
Swiss National Bank
. It would have been minted only by
Swiss commercial banks
, under the supervision of the Swiss Confederation. The backers of the gold franc hoped that its institution would have made it easier for small savers to invest in gold by reducing the minimum investment and trading unit.
[5]
References
[
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]
External links
[
edit
]
- Gold Franc Association
- coordinating the efforts to introduce the gold franc as additional currency in Switzerland.
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Circulating
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Defunct
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Private
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See also
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