The gold price failed to hold above the psychological $1,200 threshold as fading support for the Swiss gold referendum weighed heavy on the market.

The gold price fell back after the latest poll suggested the Swiss would narrowly reject the proposal for the Swiss Central Bank to hold 20% of their reserve in gold, repatriate all Swiss gold held in the UK and Canada and stop all future sales of Swiss Central Bank gold.

Unsurprisingly the government and national bank are against the proposal as it would limit their ability to increase the national debt.

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. Switzerland has the world’s 8th largest gold reserves and was the last country in the world to back their currency by gold.

The world’s largest gold backed exchange traded fund, The SPDR Gold Trust, which is often used as a barometer of investor sentiment, confirmed its holdings fell 0.3% yesterday to 720.91 tonnes. Gold is currently trading at £759.0 per ounce, silver £10.36 per ounce, platinum £764.62 per ounce and palladium £489.65 per ounce.