Impact of gold sales on UK GDP figures

FOI reference: FOI-2024-2314

You asked

I have tried to digest the allocation and gold affect to UK GDP figures and also noticed within your high level summary of non-monetary gold that the USA appears to ignore the buying/selling of gold and only include the physical production of it.

So my question is two fold please:

Firstly, If we adopted that same USA method would that bring down our own GDP and if so by how much (rough estimate using latest annual figures to hand).

Secondly, using the Governments own stated figures of Defence spending as a %of GDP and also the Foreign Aid spending as a % of Gross National Income, then how much would these two areas save/reduce by excluding NM-gold figures from our GDP etc?

In simple terms, would this alternative mechanism to exclude NM-Gold reduce the cost outlay commitment from those two areas of commitment presently for other areas of Government spending?

We said

Thank you for your request.

In the UK Non-Monetary Gold is recorded within the trade export and import figures with an exact offset within the Valuables series in Gross Capital Formation therefore in the UK national accounts Non-Monetary Gold has no impact on GDP.   

We can however, highlight the impact to help users, but this is a presentational approach. More detail is provided on this below.  

The Office for National Statistics (ONS) publishes data on UK trade which includes non-monetary gold (NMG) and other precious metals in its headline statistics. 

Precious metals include non-monetary gold, silver, platinum and palladium. The category forms part of the commodity group "unspecified goods". Non-monetary gold comprises the majority of this group and is the technical term for gold bullion not owned by central banks. 

In line with international standards, our headline trade statistics contain the UK's exports and imports of non-monetary gold. More information can be found in our National Accounts article: A brief explanation of non-monetary gold in national accounts. 

Because NMG is an erratic series, please note that all trade figures in our UK trade monthly bulletin exclude non-monetary gold (NMG) and other precious metals unless otherwise stated. 

The ONS publishes data on the UK trade balances in our UK trade release. This data includes a precious metals series as well as Total trade balances including or excluding precious metals. Data on the UK balance can be found in the associated download.

Separately, valuables are published with the Gross Capital Formation data where non-monetary Gold is included within the Acquisitions less disposals of Valuables dataset within Gross Capital Formation. Imports of non-monetary gold are treated as acquisitions whilst exports are treated as disposals.  

Therefore, the treatment of Non-monetary gold is GDP neutral when treatment by Trade is taken into account as described in the linked article. National Accounts article: A brief explanation of non-monetary gold in national accounts. 

Non-monetary gold is included in the aggregated acquisitions less disposals of Valuables data published by ONS but is not published in its own right - neither do we publish any aggregated Valuables data excluding non-monetary gold. 

As mentioned above, Non-Monetary Gold has no impact on the level or growth of GDP as it is balanced in the different sides of the UK National Accounts, therefore if we excluded NMG there would still be no impact on the level or growth of GDP in the UK and therefore defence spending as a % of GDP, and Foreign aid spending as a % of Gross National Income would not change. 

Any queries related to the USA approach would be better placed with Bureau of Economic Analysis (BEA).