New Islamic banking rules make gold an accepted investment

Transactions must be fully backed by physical metal and settled on the same day to observe Islam's distinction between real economic activity and speculation.} Gold has become an accepted investment in the Islamic world for the first time as it can now be used as a commodity to back Sharia-based financial products, thanks to new standards announced Monday. The fresh rules, said the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) and the World Gold Council (WGC), pave the way for Islamic institutions to trade not just gold but also silver in a much more actively fashion. Until now, there were no specific rules for the use of gold as an investment in the Islamic finance industry, they noted. AAOIFI spent about a year working out the new guidelines on gold trading with the WGC, and agreed them last month. "The complexity of Islamic attitudes toward gold products has led to a scattered and fragmented set of rulings," the council said in a sta
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