, IncApril 27, 2010 - Gold prices around the world are flat going into Tuesday trading, although one central bank is finally starting to loosen up on its gold supply due to be sold over the next four years as part of the Central Bank Agreement. On Monday the International Monetary Fund announced that it sold 5.6 tons of gold in February under the second phase of the CBGA. According to the World Gold Council, that’s the largest amount of gold sold by any central bank since the most recent Central Bank Gold Agreement began last September.
In all, central banks have sold only 7.2 tons of gold since September. Don’t expect this limited supply of gold from the world’s central banks to affect the overall market much. Analysts say there are too many other issues keeping the price of gold flat right now. Mining companies aren’t really finding new sources of gold, and investors are holding back, waiting for key news on interest rates in the U.S. and a bank bailout package making its way through the Greek legislature. Also as more and more people look to their scrap gold as a kind of personal bailout in a the down economy, we’re seeing scrap gold sales keep up with any slight increase in demand for the first quarter of the year.
Some analysts believe the weakness of the euro could increase interest in gold reserves around the world, while others say the strength of the dollar, coupled by the euro’s weakness, will continue to keep gold prices flat. The amount of gold traded last week was lower, indicating that interest in gold is fading while investors entertain too many questions about the near future of the gold market.
Stewart Lawson
Senior Staff Writer - GoldPrice.net
