Australia's first physical bullion exchange, an over-the-counter spot market for gold, silver and platinum, will begin operations Oct 4, the Australian Bullion Exchange (ABX) said in a statement on Tuesday.

Bullion would be bought and sold on the exchange through listed brokers, it said, adding it was targeting a number of large financial institutions to register as members.

Australia is the second-largest gold producer in the world; we should have a globally recognised exchange to accompany this position, said Thomas Coughlin, CEO of the ABX.

Market pricing will be based on real-time international interbank spot bullion markets in nine different currencies, eliminating pricing risk and providing transparency, it said.

The ABX will also offer custodial services for investors who do not want to store bullion.

The exchange said it had adopted the London Bullion Market Association principles for assessing bullion.