Published: 2011/05/05 07:27:42 AM
MEXICO, Russia and Thailand added gold now valued at about $6bn to their reserves in February and March as the price of bullion advanced to a record, International Monetary Fund (IMF) data showed yesterday.
Mexico added 93,3 tons since January, when holdings were about 6,9 tons, the data on the IMF’s website shows. Russia increased its reserves of the metal by 18,8 tons to 811,1 tons in March and Thailand expanded assets by 9,3 tons to 108,9 tons in the same month, according to the IMF.
"Central banks have good reason to buy gold ," business professor and former economic adviser to the US government Peter Morici said yesterday. "The dollar is no longer a safe asset for backing currencies. Treasuries are not a sound investment" and budget and debt issues mean central banks should buy gold.
Central banks are expanding their gold reserves for the first time in a generation. Countries boosted their holdings in 1980 when gold rose to a then-record $850/oz, only to fall for most of the next 20 years.
"Mexico’s gold accumulation confirms the demand of emerging market central banks to diversify their reserves," said Bayram Dincer, an analyst at LGT Capital Management in Switzerland.
Gold for immediate delivery climbed to a record $1577,57/oz on Tuesday and traded at $1531,60/oz in London yesterday. Global holdings by states and official institutions stood at 30523 tons by last month, the World Gold Council says. Bloomberg