India’s purchase of 200 tonnes of gold from the IMF is already paying dividends with a $800 million increase in value. With 203 tonnes still on sale, even smaller countries are looking to buy gold, and replace some of their reserves of declining dollars. See the following article from Commodity Online for more on this.
November has been the month of gold, as the yellow metal proved to the world it is the most precious metal and the most valuable asset class in the world as dollar and other currencies are beaten down in value and status.
November 2009 will be remembered as one of the most spectacular days in the history of gold—when bullion history is written—as the yellow metal surged almost every day of the month, hitting nearly $1200 per ounce. Investors who had put in money in gold some months back have reached heaps of money, riding the mad gold rush.
The biggest gainer of gold these days is India’s central bank—the Reserve Bank of India (RBI). Early this month, RBI bought 200 tonnes of gold from the International Monetary Fund (IMF) for over $6.7 billion that spurred an investor frenzy for gold, pushing the yellow metal prices to almost $1200 by the month end.
Claim up to $26,000 per W2 Employee
- Billions of dollars in funding available
- Funds are available to U.S. Businesses NOW
- This is not a loan. These tax credits do not need to be repaid
According to bullion analysts, in just three weeks after India bought the gold, the Reserve Bank of India benefited by $800 million on the investment of $6.7 billion it made in buying 200 tonnes from IMF! “It is huge money that India has gained. In fact, India’s gold reserves got richer in value thanks to the IMF gold deal,” says Mark Robinson, a Dubai-based bullion analyst.
He says this biggest gain out of the gold purchase is prompting India again to buy additional gold reserves from the IMF. “India made the smartest move in gold reserves in the recent times. While countries like China that had an upperhand in buying IMF gold was waiting for gold price to come down when India struck the deal on one fine night, surprising the bullion world,” pointed out Robinson.
When India announced the IMF gold deal on November 3, Indian Finance Minister Pranab Mukherjee had said that the government wasn’t preferential in its treatment to either to dollar or gold. The buying of gold had a sentimental significance, as the government had to pledge gold with the Bank of England in 1991 to borrow money to maintain imports.
IMF has now 203 more tonnes of gold on sale. India’s RBI is one of the leading suitors to once again purchasing the remaining IMF gold. Sensing that India is on an all-out mission to buy IMF gold, smaller countries have jumped into the gold buying fray. On Thursday, the once war-ravaged Sri Lanka announced that the country has bought 10 tonnes of IMF gold. 10 tonnes of gold is nothing compared to India’s big purchase of 200 tonnes. But a small country like Sri Lanka buying IMF gold points to the fact that central banks of almost every country is keen to buy the precious metal and make it their reserves in place of the declining US dollar.
The IMF, which has set out two months ago to sell one-eighth of its gold reserves, is trying to complete the process as soon as possible. After the sale, the IMF will remain the third-largest holder of gold after the US and Germany, according to the producer-funded World Gold Council.
Next week, or the first weeks of December will be very exciting for gold lovers, bullion dealers, speculators and central banks. Which country or central bank will buy the additional gold stocks available for sale from IMF? China, Russia, Brazil, India….No country can be ruled out of the IMF gold buying race.
This article has been republished from Commodity Online. You can also view this article at Commodity Online, a commodity news and analysis site.
