A driving force behind the bull market in gold over the past several years remained in full gear last month, according to the International Monetary Fund (IMF).
Earlier today, the IMF reported that Brazil, Kazakhstan and Turkey were the largest buyers of the yellow metal in October. In total, over 40 tonnes of gold were purchased by central banks in the previous month.
On a percentage basis, Brazil raised its holdings by the largest amount – 17.17 tonnes, or 48.6%, to 52.52. Additionally, the purchase marked the first time that Brazil increased its gold reserves since June of 2005.
UBS wrote in a note to clients that Brazil’s increase “is a chunky purchase by a central bank, and the gold market will likely sit up and pay attention to today’s news, not just because of its size but because this is a central bank that has not been active in the market for some time.”
(Visit GoldAlert Pro at http://pro.goldalert.com for more gold price analysis and forecasts)
Kazakhstan was the second-largest buyer in percentage terms, as it increased its holding by 7.53 tonnes, or 7.2%, bringing its total to 111.54. On an absolute basis, Turkey was the largest buyer last month, as its reserves grew by 17.54 tonnes, or 5.8%, to 319.91.
It is worth noting, however, that the United States continues to hold the world’s largest gold reserves of any country with 8,133.50 tonnes; Germany is a distant second at 3,395.50 tonnes.
Nonetheless, central banks in many of the world’s emerging economies have made substantial purchases in recent years. Many market strategists believe the purchases have been motivated by an effort to protect their nations from the currency debasement inherent in the monetary policies of central banks in the world’s most developed economies – including the Federal Reserve, European Central Bank (ECB), Bank of Japan, and Bank of England.
Commenting on the growing trend of central bank buying, analysts at Commerzbank contended that “In all probability, central-bank buying in 2012 will exceed last year’s record of 457 tons.”
On Wednesday, COMEX gold futures for December delivery – the most actively-traded contract – settled higher by $4.60, or 0.3%, at $1,728.20 per ounce.
Premier Gold Mines Reports Encouraging Results at Rahill-Bonanza
Premier Gold Mines holds a 49% stake in Rahill-Bonanza through a joint venture with Red Lake Gold Mines Limited (RLGM) – which serves as operator of the Project, holds a 51% stake, and is an affiliate of Goldcorp Inc. The Project is strategically located in the heart of the main Red Lake "Mine Trend" between the Red Lake Gold Mines complex to the east, and the Cochenour ( Bruce Channel ) Project to the west. The property is being explored from both surface and underground. Full Premier Gold Mines Press Release.
- PG12110 tested the down-dip extension of the past-producing Wilmar Mine returning an intersection of 4.01 grams per tonne gold (g/t Au) across 20.5 meters (m), or 0.12 ounces per ton (oz/t) across 67.3 feet, including 11.51 g/t Au across 3.0 m (0.34 oz/t across 9.8 feet)
- PG12112 returned an interval of 1.52 g/t Au across 126.0 m (0.04 oz/t across 413.4 feet) with higher grade intervals of up to 27.08 g/t Au across 1.0 m (0.79 oz/t across 3.3 feet)
- Multiple gold-bearing horizons, in addition to those previously announced, have been intersected in the tram; eight closely-spaced holes have been drilled to test one of these structures hosting visible gold (assays pending)
- The regional drill program, consisting of flat holes drilled at regular intervals and up to 5000 feet (1,524.0 meters) in length has commenced with the first hole having been completed
