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India Buys 200 Tons of IMF's Gold Allotment

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posted on Nov, 3 2009 @ 08:30 PM
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Wow.

Although the head of the Indian Central bank says that it isn't a precursor to moving away from the Dollar as it's reserve currency, it seems rather strange.

It was almost half of the IMF's for sale gold. Add to that that they bought it at almost record highs, and they said they may buy more, only shows that they believe that gold is still going higher, a lot higher.

And if I understand correctly, the higher gold goes, the lower the Dollar goes.

Interesting times ahead.

online.wsj.com...


The Reserve Bank bought the gold between Oct. 19 and Oct. 30, an IMF statement said. The $6.7 billion in proceeds from the sale indicate an average estimated price of $1,045 a troy ounce, far higher than the $850 per ounce the IMF expected to get a few months ago, when its executive board approved the sale.


Gold also hit a record high on this news today.


Gold futures for December delivery rose $30.90, or 2.9 percent, to $1,084.90 an ounce on the Comex division of the New York Mercantile Exchange, a record settlement price. The contract touched $1,088.50, the all-time high intraday price. The previous record was $1,072 an ounce, set on Oct. 14.


www.bloomberg.com...




posted on Nov, 3 2009 @ 08:33 PM
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You know, every time I see large movements of gold, I start to wonder. A few decades ago the price of gold went way up. Than the price plummeted. Can their be something we are not seeing?



posted on Nov, 3 2009 @ 08:34 PM
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Not only that but it establish the world currency SDR as a valid currency... Which is bad for the US dollar...in the short-medium-long term...

www.theaustralian.news.com.au...

THE International Monetary Fund has sold 200 tonnes of gold to the Reserve Bank of India, nearly half the total approved by the IMF executive board in September. Proceeds from the off-market sale amounted to .7 billion ($7.4bn), or 4.2 billion of special drawing rights, or SDR, a combination of currencies, the IMF said. Payment is expected to be in major currencies that make up the SDR. IMF managing director Dominique Strauss-Kahn welcomed the transaction as an important step toward achieving the objectives of the gold sales program, namely “to help put the fund’s finances on a sound long-term footing and enable us to step up much-needed concessional lending to the poorest countries”.

SDR are here, which means a world currency is here, which means the stage is set for the US dollar to fall as the world reserve currency.



posted on Nov, 3 2009 @ 08:35 PM
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It does seem odd they would be willing to buy so high.
I like how many Indian families own jewelry made of precious metal.

Not sure but I think their Central Bank is the only CB that is relatively democratic. I don't know if that affects things but if the Fed was more democratic I think gold would be at least mentionable.



posted on Nov, 4 2009 @ 12:20 AM
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Originally posted by Vitchilo
Not only that but it establish the world currency SDR as a valid currency... Which is bad for the US dollar...in the short-medium-long term...

SDR are here, which means a world currency is here, which means the stage is set for the US dollar to fall as the world reserve currency.



Dear Vitchilo

Please take a breath....the SDR was established by the IMF back in 1969 as a means of stabilizing currencies under the Bretton Woods fixed currency regime , and to facilitate international trade. With the closing of the Gold window , the switch to a floating currency system , and the expansion of global capital markets , the SDR has become irrelevant in terms of it's initial functions , but still enjoys limited use a a pricing benchmark , primarily in Europe/EU. Whether the SDR can ever be reworked/revitalized to serve as an acceptable/efficient reserve currency is yet to be determined.

SDR

For those who were wise enough to follow the smart money into Gold , back in 2003 , 2006 , last year , or last week for that matter....my little friend has a special message for you.

India bought 200 tonnes of IMF Gold in an off-market purchase , but as we witnessed today , these IMF off-market transactions are traditionally supportive of the open market price....alot of short-covering activity today as specs scurried to get out from in front of an oncoming freight-train.

According to the IMF , India bought the last 2wks of Oct , paying an average of $1,045oz (market value for approx 6,430,000 ounces). Rounded-off @ tonight's $1,083oz shows a gain of $244'340,000.

Not bad for a weeks work!

Now China , shrewd as ever , wanted that IMF Gold , but at a discount to market....


China weighs purchase of IMF gold

Two Chinese central bank officials not directly involved in the issue told Reuters China should consider buying the gold being put up for sale by the IMF, but only at a big discount.....

"I think we should build up more gold with foreign reserves, but when to buy is the key. It's a good idea if China can buy the gold from IMF at prices well below market level."

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Central banks , aside form Beijing , are eager to build Gold reserves , and I'd say China slightly under-estimated demand here.

Translation: With physical Gold in shallow supply...let the bidding wars begin!



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