European Central Bank Gold Sales Lowest Since 1999 Accord

European central banks sold 5.1 metric tons of gold in the fourth year of an accord that originated in 1999, the lowest on record, according to data from the World Gold Council.

Germany sold 5 tons and an unidentified bank disposed 0.1 ton in the year through Sept. 26, the cpuncil, a London-based producer-funded group, said in a report on its website. That’s the lowest annual total since European central banks agreed to limit sales in September 1999. Germany’s Bundesbank sells a small amount each year to mint coins.

Central banks, which own 18 percent of all the gold ever mined, will add as much as 350 tons valued at about $15 billion this year, the council estimates. They purchased 535 tons in 2012, the most since 1964. Gold fell to a 20-year low in August 1999 as Switzerland, Netherlands, Austria and U.K. prepared to sell gold. Gold rose from 2001 through 2012.

“Back in the early 2000’s, this agreement was seen as a real key support for the market,” said Matthew Turner, an analyst at Macquarie Group Ltd. in London. “Now it seems a bit superfluous.”

Gold, which entered a bear market in April, slid 22 percent this year to $1,302.80 an ounce by 12:28 p.m. in London. The metal set a record $1,921.15 an ounce in September 2011.

Bullion sales under the current agreement total 200.50 tons since the third five-year agreement started in September 2009, according to the council. Central banks have sold 4,084.50 tons since the first agreement, and failed to reached the allowed limit each year since 2003, its data show.

“Central banks have lost their appetite for seling gold,” said James Murray, a spokesman for the council. “Gold remains a hugely important part of their portfolios and this has been the case for the past few years.”

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net

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

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