Kazakhstan, Mongolia Increased Bullion Reserves in December, IMF Data Show

Kazakhstan and Mongolia added to their gold reserves in December as the precious metal advanced for an 11th consecutive year, according to the International Monetary Fund.

Kazakhstan’s bullion holdings rose 3.1 metric tons to 76.7 tons and Mongolia added 1.2 tons to take its assets to 3.5 tons, data on the IMF’s website showed. Ukraine increased gold reserves by 0.1 ton, Mexico cut them by 0.2 ton and Mauritius reduced them by 0.1 ton, the data show.

Central banks are expanding reserves for the first time in a generation as holdings in exchange-traded products are within 1.9 percent of an all-time high set last month. The banks may buy 600 tons this year, according to Goldman Sachs Group Inc. (GS) Global holdings of the metal advanced by 66.6 tons in November from a month earlier to 30,877 tons, the IMF data show. That’s equal to almost 11 years of world mine production.

“The trend of emerging countries’ official sector gold buying will continue this year, which will be a price-supportive factor going forward,” said Bayram Dincer, an analyst at LGT Management in Pfaeffikon, Switzerland. “The desire of central banks to diversify reserves with hard-currency gold is high and a long-term process.”

Gold for immediate delivery gained 10 percent last year and reached a record $1,921.15 an ounce in September. It traded at $1,660.93 by 10:19 a.m. in London today and is up 6 percent this month.

Gold accounts for about 13 percent of Kazakhstan’s total reserves, and 5.2 percent of Mongolia’s, according to the latest report from the London-based World Gold Council. The metal accounts for more than 70 percent of reserves of the U.S. and Germany, the biggest holders, the data show.

To contact the reporter for this story: Nicholas Larkin in London at nlarkin1@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

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