| ISO 4217 | |
|---|---|
| Code | XFO |
| Demographics | |
| Date of introduction | 1930 |
| User(s) | Bank for International Settlements |
| Valuation | |
| Pegged with | 1 XFO = 0.290322 gfine gold |
| This infobox shows the latest status before this currency was rendered obsolete. | |
Thegold franc (currency code: XFO) was the unit of account for theBank for International Settlements from 1930 until April 1, 2003.[1] It was replaced with thespecial drawing right.[2] It was originally based on theFranc Germinal, and remained at the value the franc was pegged (0.290322 g fine gold) after the countries of theLatin Monetary Union came off the gold standard.[3]
The gold franc was used in the Anglo-French Condominium of theNew Hebrides (nowVanuatu) 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 theNew Hebrides franc were used in normal trade (and in which even thepound sterling turned up in the columns of earlier joint administration budgetary documents).
On March 9, 2011, a parliamentaryinitiative was introduced in theNational Council of Switzerland to institute a gold franc as additional currency forSwitzerland:
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 theCommittee for Economic Affairs and Taxation, which rejected it at the June meeting.
This gold franc would have been defined as 0.1gram of finegold.[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 asafe-haven currency, to divert international capital flows in times offinancial crises away from the Swiss franc.[7]
The gold franc would have been completely independent from the gold reserves of theSwiss National Bank. It would have been minted only bySwiss 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]
