The International Monetary Fund, which set out a year ago to sell about 13 percent of its gold holdings, sold 10 metric tons to Bangladesh for $403 million.
The transaction brings total central bank purchases from the fund to 222 tons, according to fund data. India has bought 200 tons, Sri Lanka 10 tons and Mauritius 2 tons. A further 88.3 tons has been sold under the agency’s “on-market” sales program, it said in a statement yesterday.
The lender’s executive board approved the sale of 403.3 tons of bullion on Sept. 18 last year as part of a plan to shore up its finances and lend at reduced rates to low-income countries. After selling only to central banks, it expanded sales to the open market in February.
The transaction “will push gold higher as central bank purchases have traditionally been a major factor fueling the price,” said Hwang Il Doo, a senior trader at Korea Exchange Bank Futures Co. in Seoul. “Central banks want to diversify their reserves because of the unstable dollar and we may see more buying down the road.”
Gold for immediate delivery gained 0.2 percent to $1,246.45 an ounce today, and is about $19 below its record $1,265.30 an ounce on June 21. The price dropped 0.9 percent yesterday, the biggest decline since July 27, as a rally in equities reduced investor demand for wealth protection.
The “on-market” sales don’t “preclude further off-market gold sales directly to interested central banks or other official holders,” the fund said.
“Whenever these things come out, they tend to be relatively supportive of the gold price,” said Darren Heathcote, head of trading at Investec Bank (Australia) Ltd. in Sydney. “It’s not huge. It will add more support to what is already a well-supported market.”
Calls by Bloomberg News to the phone listed on the central bank’s website for M. Abdul Haque, general manager for the Forex Reserves and Treasury Management Department, were unanswered.