The LBMA Gold Price, the new gold price benchmark, is set to launch next month, Intercontinental Exchange (ICE) announced Thursday.
ICE Benchmark Administration (IBA) says it expects to launch the new benchmark on March 20 to replace the London Gold Fix.
The new pricing mechanism is being introduced in an effort to shore up confidence in the wake of greater scrutiny of financial benchmarks generally, following the LIBOR market manipulation scandal.
IBA will operate a physically settled, electronic and tradable auction to set the LBMA Gold Price. The price will be quoted in U.S. dollars, and participants will be able to settle orders in dollar, Euros and British pounds. Under the new process, aggregated bids and offers will be updated in real-time, and the price will be updated every 30 seconds, IBA said.
“Under the administration of IBA, the new LBMA Gold Price will benefit from increased transparency, and the robustness of the data used to calculate the benchmark will give a better representation of the market price,” said Finbarr Hutcheson, president of IBA.