Bank chiefs agree cap on gold sales
EUROPEAN central banks agreed to a third five-year cap on gold sales and said planned disposals by the International Monetary Fund (IMF) could be done within the accord.
The European Central Bank and 18 other banks agreed to sell no more than a combined 400 metric tonnes of the metal a year until September 2014. That’s less than the annual cap of 500 tonnes in the current agreement, which expires on September 26.
Unconstrained
“It’s positive for gold,” John Reade, an analyst at UBS in London, said. Having the agreement “removes the small chance that European central banks would have dumped gold onto the market in an unconstrained manner”.
Central banks sold 73pc less gold in the first half and full-year disposals may drop to the lowest since 1994, according to estimates from London-based researcher GFMS. The IMF wants to sell 403 tonnes from its reserves of 3,217 tonnes, the thirdlargest holding after the US and Germany.
