Russia and Kazakhstan expanded gold reserves for a fourth straight month in January, while Azerbaijan acquired bullion for the first time in more than three years, as central banks sought to diversify their assets.
Russian holdings climbed 12.2 metric tons to 970 tons last month after gaining 8.5 percent over 2012, according to International Monetary Fund data. Kazakhstan’s hoard grew 1.5 tons to 116.8 tons, following last year’s 41 percent expansion, data on the IMF website showed. Azerbaijan’s holdings rose 1 ton, the first gain since May 2009, when it held 64 ounces.
Gold fell for a fourth month in January, with analysts from Goldman Sachs Group Inc. to Credit Suisse Group AG calling an end to the metal’s 12-year bull run as data showed the global economy improving. Gold slumped to a seven-month low last week as investors cut holdings in exchange-traded products. Central banks will again be strong buyers this year after they boosted purchases 17 percent to 534.6 tons last year, the most since 1964, according to the London-based World Gold Council.
“Central-bank buying remains one of the bullish factors for gold,” Jiang Yangjing, an analyst at China International Capital Corp., said by phone from Beijing. “Prices at the moment are driven largely by macroeconomic data.”
Gold for immediate delivery traded at $1,593.45 an ounce at 11:49 a.m. in London, down 4.9 percent this year. The price dropped to $1,555.55 on Feb. 21, the lowest since July 12, as some U.S. Federal Reserve policy makers advocated more flexibility in economic stimulus. A fifth straight monthly loss in February would be the worst run since 1997.
Azerbaijan held 218 ounces in February 2001 and reported no holdings from March that year to April 2009, the IMF data show.
Turkey’s holdings, which rose 10.3 tons last month, jumped 84 percent in 2012 as it accepted gold in its reserve requirements from commercial banks. Belarus’s reserves expanded 0.5 ton in January, while Tajikistan acquired 0.1 ton the same month, according to the IMF data, which are updated as countries report. Serbia bought 0.3 ton in December, and Venezuela added 1.9 tons in November, the data showed.
Billionaire investors George Soros and Louis Moore Bacon cut their stakes in gold ETPs in the last quarter of 2012, while John Paulson maintained his share, filings showed this month. Total investor holdings in ETPs stood at 2,560.097 tons on Feb. 22, down 2.8 percent from a record reached on Dec. 20.
An “inevitable unwind of the 12-year gold bull market has begun,” Ric Deverell and Tom Kendall, analysts at Credit Suisse, wrote in a Feb. 21 report. Gold will probably peak in 2013 and keep declining the following year as U.S. growth accelerates, Goldman Sachs said in a report on Dec. 5. Immediate-delivery metal reached a record $1,921.15 an ounce in September 2011.