Gold Climbs for Fourth Day After IMF Completes Sale of Reserves

Gold rose for a fourth day in London, buoyed by the International Monetary Fund announcing that it completed a planned sale of some of its bullion reserves. Silver, platinum and palladium also advanced.

The IMF sold about 403.3 metric tons, or 13 percent of its reserves, in a program that began in September 2009, the Washington-based group said yesterday. The total amount sold was equal to about 15 percent of global mine supply, according to data GFMS Ltd., a London-based research company.

“The last of the overhang has now gone,” Peter Richardson, chief metals economist at Morgan Stanley in Melbourne, said by phone today. “The market will take that as a positive development.”

Gold for immediate delivery advanced $3.07, or 0.2 percent, to $1,388.67 an ounce at 12:16 p.m. in London. Gold climbed 27 percent this year, reaching a record $1,431.25 on Dec. 7. Gold for February delivery on the Comex exchange in New York was little changed at $1,389.10 an ounce.

More than half the IMF gold was bought by the central banks of India, Sri Lanka, Mauritius and Bangladesh, according to past announcements. With the IMF’s sales complete, few others are selling gold, said Suki Cooper, an analyst with Barclays Capital in New York, in an e-mailed report today.

“Outside of the IMF sales, little other selling has materialized with the Euro-system banks selling remaining subdued,” Cooper said. “Gold’s price reaction was muted in response to the news, but in the absence of the IMF sales, the sector is set to swing into a net buyer of gold.”

Gold also advanced as the dollar weakened. The U.S. Dollar Index, a gauge against six counterparts, dropped as much as 0.5 percent today. Gold usually move inversely to the dollar.

Silver for immediate delivery was little changed at $29.3625 an ounce. The metal, which gained 74 percent this year, is likely to rise more than gold in 2011 as industrial demand strengthens, Credit Agricole SA said in a report yesterday.

Platinum rose $5.90, or 0.3 percent, to $1,733 an ounce and palladium gained $4.20, or 0.6 percent, to $757.25 an ounce.

-- With assistance from Sandrine Rastello in Washington. Editor: John Deane, Stuart Wallace

To contact the reporter on this story: Chanyaporn Chanjaroen in Singapore at cchanjaroen@bloomberg.net

To contact the editor responsible for this story: James Poole at jpoole4@Bloomberg.net

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