Venezuela sells US$570m from gold reserve despite US sanctions

[CARACAS] Venezuela sold about US$570 million in gold from central bank reserves over the past two weeks, skirting US Treasury sanctions designed to freeze assets of the Nicolas Maduro's administration, according to people with knowledge of the matter.

Caracas sold about 9.7 tonnes of gold on May 10 and an additional 4 tonnes three days after, the people said.

The operations helped the bank's total reserves to fall to a 29-year low of US$7.9 billion, according to data provided by the monetary authority.

The proceeds will be partly used to fund imports through the country's foreign trade office, according to one of the people.

A central bank press official didn't immediately respond to requests for comment on the sales.

Venezuela has sold 23 tonnes of gold since the beginning of April, defying an economic blockade meant to stop the lucrative trading President Maduro has been using to keep the military loyal to his regime.

Last month, the US Treasury's Office of Foreign Assets Control included the Venezuelan central bank its list of sanctioned entities.

President Maduro has been selling gold to firms in the United Arab Emirates and Turkey, as sanctions increasingly cut off his authoritarian regime from the global financial system. While he maintains a stranglehold on power on the ground - including the military and government bureaucracy - opposition leader Juan Guaido is using support from dozens of countries to slowly seize Venezuela's financial assets abroad.

Gold makes up the bulk of Venezuela's reserves. That includes US$1.2 billion worth of the precious metal with the Bank of England, which has recently blocked Mr Maduro's repeated withdrawal attempts.

BLOOMBERG