Home' Australian Resources and Investment : March 2010 Contents AUSTRALIAN RESOURCES & INVESTMENT • MARCH 2010 • 61
THE OFFICIAL SECTOR
The fourth quarter of 2009 was an interesting one for the official sector.
Separately, the pattern of behaviour among central banks continued its
recently established trend, as sales under the third Central Bank Gold
Agreement (CBGA3) slowed to a negligible rate, whilst banks and
official sector institutions outside of the agreement clocked up another
quarter of net purchases, according to our estimates.
The most significant development of the quarter was the
announcement by the Reserve Bank of India (RBI) that it had bought
200 tonnes of the IMF’s 403 tonnes of planned gold sales. The move
boosted the RBI’s gold reserves to 558 tonnes and lifted the proportion
of gold in total reserves to 6.4% from 4.0% prior to the sale. The RBI
announcement was followed swiftly by the news that Sri Lanka’s central
bank purchased 10 tonnes of gold from the IMF in a transaction that
tripled its holdings of gold, which now stand at 15.3 tonnes and
account for over 22% of total reserves. Finally, the Bank of Mauritius
announced that it had purchased a further 2 tonnes, doubling the
bank’s holdings to 3.9 tonnes.
In approving the sale of 403 tonnes of gold in September, the
Executive Board of the IMF committed to conducting a programme of
sales in a way that would not disturb the market. In keeping with this
intention, these off-market transactions had no impact on the net
supply of or demand for gold in the market. Nevertheless, they signalled
a clear desire among central banks to maintain an allocation to gold.
The announcements from India, Mauritius and Sri Lanka made clear that
the purchases were designed to restore the balance of gold in their
reserve asset portfolios, which had declined over time as gold reserves
failed to keep pace with increasing foreign exchange reserves.
These transactions, together with the ongoing programmes of gold
purchases by the central banks of Russia and China reaffirm gold’s role
as a key element of global monetary reserves as well as a growing
recognition of gold’s unique properties as a monetary asset and as a
protector of wealth.
TOP 40 OFFICIAL GOLD HOLDINGS*
Source: IMF, national data, WGC
* This table was updated in December, 2009 and reports data available at that time. Data are taken
from the International Monetary Fund’s International Financial Statistics (IFS), December 2009
edition, and other sources where applicable. IFS data are two months in arrears, so holdings are as
of October 2009 for most countries, September 2009 or earlier for late reporters. The table does
not list all gold holders: countries which have not reported their gold holdings to the IMF in the
last six months are not included, while other countries are known to hold gold but they do not
report their holdings publicly. Where the WGC knows of movements that are not reported to the IMF
or misprints, changes have been made. The countries showing as having 0.0 tonnes of gold report
some gold but less than 0.05 tonnes to the IMF.
** The percentage share held in gold of total foreign reserves, as calculated by the World Gold
Council. The value of gold holdings is calculated using the end-October gold price of $1040.00 per
troy ounce (there are 32,151 troy ounces in a metric tonne). Data for the value of other reserves
are taken from IFS, table ‘Total Reserves minus Gold’. 1 BIS and IMF balance sheets do not allow
this percentage to be calculated. In the case of any countries, up to date data for other reserves
are not available.
% of reserves**
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