With the gold price down £12.10 per ounce this week the gold market is looking to the Swiss gold referendum for some bullish news. The vote will take place on the 30th of November and will ask the Swiss population to cast their vote on the following measures.

The mandate by the Central Bank of Switzerland is to hold 20% of their total reserves in gold bullion.

To repatriate all Swiss gold vaulted in London and Canada, and to

Stop all future sales of Swiss Central Bank gold.

If the Swiss vote “yes” the Central Bank would need to spend $50 billion to bring the reserve ratio up to 20%, which equates to a staggering 1,000 tons of gold. Bank of America analyst, Michael Widmer, has forecasted that a “yes” vote would cause an 18% rise in the gold price.

Switzerland mines no gold but is the world’s leading refining centre and vaults a significant amount of Sovereign and privately owned gold. Switzerland has the world’s 8th largest gold reserves and was the last country in the world to back their currency by gold.

With only 3 weeks left until the vote the fight between the Swiss Central Bank and the Yes campaign is intensifying with recent polls suggesting the outcome is now too close to call.

Interestingly, PayPal decided to stop all transactions to the Swiss Gold Initiative earlier this week. An alternative has now been set up with donors able to transfer money directly to the Swiss Post Finance account.