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

To: John Barendrecht who wrote (3534)	11/24/1997 9:51:00 PM
From: goldsnow	Read Replies (2) \| Respond to of 116814

John, forget about war. When Rubble was non-convertible and useless people were standing in line for 2-3 hours to buy jewelry eqivalent to say 2-3 months of their salary. Vodka or Ethanol considered to be better currency. Now, who wants to hold some Asian currencies now with the risk of devaluation Seperatly, Gold prices egdes lower on BoE governor comment 03:09 p.m Nov 24, 1997 Eastern LONDON, Nov 24 (Reuters) - Gold prices edged lower on Monday afternoon after Bank of England Governor Eddie George said he would be ''surprised'' if the European Central Bank (ECB) held large stocks of the metal. The bullion price lost about a dollar from its already beleaguered level to close at $303.90/$304.40 per ounce. ''The market and the central banks and especially the smaller ones, are looking for a signal on the level of ECB gold holdings. This seems to indicate it will be holding towards the lower end of the expected range,'' said Kamal Naqvi, precious metals markets analyst at Macquarie Global Equities said. George was speaking to the European Parliament's Monetary Affairs Subcommittee in Brussels. He said, ''I would be surprised if that decision involved holding large quantities of gold because whereas gold used to be seen as (a good asset...) it's now seen as the bottom of the pile,'' he said, referring to a possible ECB decision on what it should do with its reserves. Naqvi said George's remark seems to indicate there have been discussions in the central banking community. ''That's likely to be part of an ongoing process until the ECB is established next year. But I'm surprised that Eddie George should comment so publicly,'' he said. The world's central banks hold reserves of over 28,000 tonnes of gold of which about half is in the vaults of the European banks. Annual gold production is about 2,400 tonnes. Currently the European Monetary Institute (EMI), the ECBs forerunner, holds gold reserves equivalent to 20 percent of the gold holdings of each central bank in the European Union (EU). Given the level of EMI gold holding, an ECB gold reserve of around 20 percent would be neutral to positive for the market but anything less would be seen as bearish, Naqvi said. ''George's comment suggests this will be the case,'' he added. At a central banking conference in London last week, officials from the Bank of England and the Bank of France strongly supported the idea that gold should be part of the ECB's reserves. ''It (George's remark) could show there is some acceptance of gold playing a role but not a big one. From that point of view it is not very controversial as nobody thought it should have a big role,'' one precious metal market analyst said. According to the Maastricht Treaty the ECB will have up to the equivalent of 50 billion euros in reserves in forms decided by the ECB governing council. However the foreign exchange reserves supplied by the national central banks cannot include ECUs, currencies of EMU participants or International Monetary Fund reserves. Two weeks ago a rumour -- denied by banking sources -- that the ECB would have no gold in its reserves put pressure on prices. Gold prices for most of this year have been rattling around their lowest levels in over 12 years after a Dutch sales announcement was compounded by announcements that Germany's Bundesbank might revalue its 3,700 tonnes of gold reserves. Then the revelation that Australia had sold 167 tonnes of its gold deemed surplus to requirements, and last month that Switzerland could sell 1,400 tonnes of gold, also no longer needed, plunged the market to its recent nadir. --Brian Spoors, London Nesroom +44 171 542 8058