Vancouver The Bank of England’s last auction of gold reserves on Tuesday failed to boost the price of the precious metal.
The 20-tonne gold sale was well received with subscribers outpacing supply by a healthy 3.7 times. This was a marked improvement over the January auction, which was 1.4 times over subscribed. The sale price came in at US$296.50 per oz., the highest of any of the Bank of England’s 17 gold sales.
Since the auction process began in July 1999, the Bank of England has sold 395 tonnes of gold. According to the World Gold Council, gold reserves for the Bank now stands at 320 tonnes, the lowest among leading nations of the European union at 7% of the country’s gross reserves. The low reserve ratio is highlighted by the United States, which holds 8,149 tonnes of gold marking 55.6% of its total reserves.
The sales raised an estimated US$3.3 billion for the UK treasury.
The reprieve from Central Bank dumping of gold is expected to be short lived and a number of countries, most notable Germany and Switzerland, have announced intentions to sell a portion of the their holdings in the future.
In New York, April gold was down US$2.60 to US$294.60 per oz after early buying took it just shy of US$300 per oz. Spot gold was quoted at US$294.20, down US$2.80 on the session.
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