Details of UK Gold Sales
LONDON (7 May 1999): The price of gold fell by more than $5 on Friday after the surprise move by the Bank of England on Friday to reduce its official gold reserve holdings by 58 per cent in the medium term to 415 tonnes.
The central bank said it intended to sell 125 tonnes, or 3 per cent of total reserves, in the fiscal year 1999-2000, investing the proceeds in foreign currency assets, as it sought to achieve a better balance in its portfolio.
In early London trading, gold was at $283 per troy ounce, against a previous close of $288.75 and a New York close on Thursday of $289.35.
Analysts said the move was totally unexpected because the UK central bank normally holds on to its gold reserves. There were concerns of further selling across the board in London, the centre of the international bullion market.
The Bank said it planned a series of five monthly auctions, starting July 6, to eventually reduce its holding of 715 tonnes, which at $6.5bn constituted about half of the Bank's total reserves, to 300 tonnes.
About 25 tonnes of gold, in the form of London Good Delivery bars, will be offered at each auction to members of the London Bullion Market Association and central banks and monetary institutions. The minimum bid will be 400 ounces.
Details of the auctions in 2000-01 will be announced nearer the time.
Posted by Teetmyer at 07:51 on the Gold Eagle Forum.
gold-eagle.com
Morning Lorne,
Looks like about 25 tons/month this year.
John
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