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Gold/Mining/Energy : Golden Eagle Int. (MYNG) -- Ignore unavailable to you. Want to Upgrade?

To: C Hudson who wrote (20601)	9/26/1999 11:28:00 PM
From: C Hudson	Respond to of 34075

Gold up $9

To: C Hudson who wrote (20601)	9/26/1999 11:31:00 PM
From: Jim Bishop	Read Replies (1) \| Respond to of 34075

WASHINGTON, Sept 26 (Reuters) - Europe's central banks joined forces on Sunday to restore confidence in a shattered gold market with a vow to sell no more than 2,000 metric tons of bullion over the next five years and to strictly control the pace of sell-offs. The strategy, announced by 15 central banks on Sunday evening in Washington, had an instant impact, propelling spot prices more than $6 higher in early Asian trade to their highest level since May, when British gold sale plans sent the market into freefall. European Central Bank President Wim Duisenberg said the banks owned 70 percent of the gold in the world's central bank vaults and that sales would be limited to about 400 metric tons each year. The agreement was hammered out on the sidelines of a meeting of the International Monetary Fund and included the 1,300 metric tons of gold the Swiss central bank has already said it would sell as well as the gold still to be sold by the Bank of England. Duisenberg also said he believed the United States, which had been in on the talks among the Europeans, had no plans to alter a a clear position against selling Federal Reserve gold. ''Gold will remain an important element in global monetary reserves,'' the Europe central banks said in a joint statement. ''We hope to remove ... the uncertainties overhanging the gold market for far too long a period already,'' Dutchman Duisenberg added in a hastily called news conference. ''We hope we will be successful in this endeavor.'' Spot gold rose more than US$6 in early trade in Sydney and Hong Kong, quoting at $275.00/$276.0 an ounce, versus a New York Friday closing price of $268.50/269.0. Analysts in Australia said the Europeans had eliminated the uncertainty which had plagued the market and plunged prices to 20-year lows in recent months after the Bank of England said in May it would sell more than half of its 715 metric tons of reserves. ''We should see gold go to at least US$285,'' said Keith Goode, an analyst at Bell Securities Ltd in Sydney. The Bank of England carried out a second auction of 25 metric tons last week, leaving it with another 365 tons of the yellow metal to offload over in the coming few years. While slim beside the Swiss plans, the British sale program delivered a tough reality check to the market -- that gold was no more considered the ephemeral symbol of investment security. ''(The uncertainty) increased after the UK authorities announced their intention to sell a certain amount of gold. This made us wonder, what will other central banks do? This led us to this agreement,'' Duisenberg said. The banks behind the Washington deal are the European Central Bank, and the central banks of Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, Switzerland, and England. Duisenberg said there was no link between the timing of their announcement and confirmation at the IMF on Sunday that plans to write off debt in Third World countries would be financed in part by the sale of 14 million ounces of IMF gold reserves. The IMF gold sale plan, officially endorsed on Sunday, had also weighed on the market over the past few months. ''It is a pure coincidence that the statement is being issued on the same day,'' Duisenberg said. ''The only reason behind the coincidence is that we all happened to be here today,'' he said. Related News Categories: currency, US Market News