Update: No plan to sell gold this year - Russia

The Russian government says it has postponed plans to sell gold after information of the sale was leaked into the market

MOSCOW (Reuters) - 

The Russian government said on Tuesday it had postponed its plans to sell up to 50 tonnes of gold this year, after information about the sale was leaked to the market, but the gold market failed to react.

"Due to the leak of the information the sale in the reported period and in the reported form will not take place," deputy head of the government agent for precious metals sales, Almazjuvelirexport (Almaz), Sergei Gorny, told Reuters.

He declined to sell when the sale may take place.

On Friday, sources told Reuters the government planned to sell 20-50 tonnes of gold -- worth up to $1.7 billion at current prices -- to help plug a budget deficit in the first major sale since the fall of the Soviet Union.

The sales from Russia's State Precious Metals and Gems Repository (Gokhran) could account for 0.5 to 1.25 percent of global consumption of the metal, which soared in price to a record of $1,070.40 per ounce on Oct. 14.

Gokhran, which traces its history to a decree by Tsar Peter the Great in 1719, holds the Russian state's stocks of precious metals such as gold and palladium and gems such as diamonds.

Gold prices were practically unmoved by the postponement, hovering around $1040 per ounce on Tuesday .

"I think generally the market didn't expect them to sell, so this shouldn't have too much of an influence on the market," a European gold trader said.

Analysts had initially been a little sceptical of the sale plans, which come at a time when Russian central bank has been steadily increasing the share of gold -- seen as a safe haven in times of turmoil -- in its reserves.

(Additional reporting by Jan Harvey) (Writing by Aleksandras Budrys)

© Thomson Reuters 2009 All rights reserved

Disclaimer

MINEWEB is an interactive publication, with rolling deadlines through each day, commencing in the Sydney morning,  and concluding, 24 hours later,  in the Vancouver evening.  If you believe your side of an issue deserves inclusion, but has failed to meet one of our deadlines, you are invited to notify the Editor in Chief in Johannesburg, and we will include you in our editing and expanding on our stories. Email him at alechogg@gmail.com

Print story      Email story      Subscribe to free newsletter

Back