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

To: Zardoz who wrote (14722)	7/20/1998 6:04:00 PM
From: goldsnow	Respond to of 116764

>>In two days the DOLLAR will be up, and gold down.>>> Maybe not .. Anglogold(ANGJ.J)sees respite from cenbank gold sales 09:55 a.m. Jul 20, 1998 Eastern JOHANNESBURG, July 20 (Reuters) - South Africa's Anglogold Ltd (ANGJ.J) said on Monday that gold producers can look forward to a lengthy respite from EU central bank gold sales. South Africa's wobbly currency, which has sparked stronger local gold prices since coming under attack by foreign speculators in May, will remain vulnerable, the gold giant said. Kelvin Williams, Anglogold's executive director of marketing, said several factors point to a more encouraging mood in the world gold market. ''I think we are now at a point where we can say that there is a very low likelihood of central bank sales out of Europe in the next three or four years,'' Williams said. Since the end of the June quarter, the issue of European Central Bank gold holdings has been resolved and and gold will make up 15 percent of the capitalisation of the new bank. Anglogold said speculation that members of the European bank may dispose of some residual gold holdings was ''misplaced.'' Any member nation wishing to sell gold could do so only with the approval of the central forum in which France, Germany and Italy are dominant members, the company said. Williams noted that the Banque de France has said publicly that the central banks of France, the United States, Germany and Italy do not plan to sell the precious metal. Another positive factor for gold was the Swiss government's intention to exercise caution in reducing the gold backing of the Swiss franc to 25 percent from 40 percent. ''The (Swiss National) Bank has indicated its intention to dispose of the metal with sensitivity towards the state of the market,'' Williams said. Anglogold's bottom line is expected to get a boost from a stronger local gold price in upcoming quarters. South African gold producers, under pressure for the past year from slumping world prices, have enjoyed higher rand gold prices in the past few weeks as the rand came under attack from foreign speculators and weakened against the dollar. The rand has lost about 30 percent of its value since January and is unlikely to see any recovery to those levels. ''At best, with no further negative news we believe that the currency might trade sideways for the rest of this year and with considerably higher volatility,'' Anglogold said in is June quarterly report released on Monday. Anglogold chief executive officer Bobby Godsell told an analysts briefing that the company would ''benefit'' from the currency devaluation. But he added non-South African investors will continue to expect good dollar dividends. ''What we will be focusing on in the six months to come is good operational results,'' Godsell said. Anglogold said physical demand for gold had been robust in Turkey and the Middle East this year, but offtake in Southeast Asia and Japan continued to suffer from the financial crisis gripping the region. ''Any slippage in physical demand in this year is likely to be more than offset by lower sales of metal by the official sector. We expect the physical market for gold to remain with a large excess of demand over new mine supply and overall in balance,'' the report said. ((Darren Schuettler, Johannesburg newsroom, 27 11 482 1003, newsroom+reuters.co.za)) Copyright 1998 Reuters Limited.