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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: goldsnow who wrote (41177)	9/27/1999 7:07:00 PM
From: Alex	Read Replies (1) \| Respond to of 116796

<<This morning alone, the 10-day moving average crossed the 100-day average, and prices charged through the 200-day moving average, a key sign of long-term direction. European Central Bank president Wim Duisenberg on Sunday announced that 15 European central banks had committed to an annual ceiling of 400 tonnes, or 2,000 tonnes over five years, on combined gold sales which includes the already announced sale plans of Switzerland and Britain. Analysts expect the gold price to touch $300 this year in the wake of the latest European plan. ``I think we will see $300 an ounce of gold this year. It may come slowly, it may come quickly. I think we are in a new environment for gold now,? precious metals analyst Martin Fraenkel of Chase Manhattan said. The statement, issued jointly by 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 in Washington on Sunday night, ended the lingering uncertainty on gold supply in the market and sparked a rush by traders to cover short positions. A key part of the statement said the banks had agreed not to expand their gold lending and use of gold futures and options over a five-year period. ``The lending restraint is probably the most important part of this package since it does dissuade other short sellers from taking advantage of a price rise. It makes borrowing gold more expensive,? Mitsui Global Precious Metals analyst Andy Smith said. Central banks lend out their reserves to get returns on an asset, the storing of which costs money. The agreement on European gold sales, which was hammered out on the sidelines of an IMF meeting, includes the 1,300 tonne of gold which the Swiss central bank said would sell and the gold that is still to be sold by the Bank of England. ``Gold will remain an important element in the global monetary reserves,? the central banks had said in a joint statement. Gold had plunged to 20-year lows after Britain in May announced its plans to sell around 58 per cent of the gold reserves. Prices started recovering, and the bullion price has shot up by nearly $30 after the second UK auction of 25 tonnes of gold last week. Brad Lambert, analyst at the independent technical research firm Trend Analysis, said he expected the market to find support at $275 a troy ounce, the bottom of a 1998 trading range that stretched up to around $315. Bob Beasley, technical analyst at Barclay's Capital, also said any pullback would falter in the mid-270s. ``This particular announcement is such a significant change in policy, it's going to provide support. I can't see setbacks being very significant,? Beasley said of the impact of the European central bank news. >> economictimes.com