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Tuesday, November 03, 2009

Indian gold futures hit new high on IMF sale

MUMBAI (Reuters) - Indian gold futures climbed to a record high on Tuesday as world prices rose on news the International Monetary Fund had sold 200 tonnes of gold to the Reserve Bank of India (RBI).
The December contract on the Multi Commodity Exchange of India Ltd rose to 16,248 rupees ($345.7) per 10 grams, erasing the previous high of 16,173 rupees on Monday.

Kishore Narne, vice president, commodities, at Anand Rathi Commodities in Mumbai, said the IMF sale would keep the sentiment bullish in the near future and could push gold to test its lifetime high of $1,070.4 struck on Oct. 14.

Gold rose half a percent in the spot market to $1,064.55 an ounce. The metal is up 21 percent this year, and will likely keep its record of not having a down year since 2000.

The IMF said on Monday it sold 200 tonnes of gold to the RBI for $6.8 billion, quietly executing half of a long-planned bullion sale that had threatened to slow gold's rally.

This was the first time since 2000 that the IMF sold gold to a central bank.

India, the world's biggest gold market, has imported less gold this year as prices repeatedly made new highs.

Imports by traders between January and Oct. 22 were 157.9 tonnes, down from 383 tonnes bought in the same period a year ago, data from the Bombay Bullion Association showed.

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