Central Bank Gold Sales Excitement!

Source:

...even during the Bank of England and Bank of Switzerland gold purge from 1999-2004, no three-month tally during the CBGA has been as high as 170 tonnes of sales into the market. The fact that the price has held up during this sharp increase is nothing short of remarkable and should highlight for even the market novice the underlying strength in the market.

If there really was ever any doubt about the tail (physical gold trading in London) wagging the dog (gold paper markets across the rest of the world), the recent excitement about all of the central bank activity in the gold market has again proven that indeed the gold market is moved by the actions of a few and it is paramount to keep an eye on that activity.

The Bank of Spain updated May sales figures this morning and no surprise, Spain sold another 28 tonnes of gold in May after having sold 40 tonnes in March and another 40 tonnes in April...

The 133 tonnes in total sales over the past 3 months has not included the 37 tonnes in sales from the ECB umbrella organization as of yet. Looking at updated figures this morning showing less than 2 tonnes of sales last week by ECB captive banks, that 37 tonne figure has yet to show up in reports. So all told, the gold market in the last 3 months actually digested 170 tonnes of gold sales from ECB banks. We have no updated figures yet on banks outside of the ECB system because they report on a 3-6 month lag.

For a point of reference, even during the Bank of England and Bank of Switzerland gold purge from 1999-2004, no three-month tally during the CBGA has been as high as 170 tonnes of sales into the market. The fact that the price has held up during this sharp increase is nothing short of remarkable and should highlight for even the market novice the underlying strength in the market.

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