Welcome!

News Feed Item

Saudi Gold Purchases Revealed, Explains Rosland Capital's Senior Economic Advisor Jeffrey Nichols

NEW YORK, June 22 /PRNewswire/ -- Jeffrey Nichols, Senior Economic Advisor to Rosland Capital (www.roslandcapital.com), had the following commentary based on recent market activity and the week ahead:

Gold prices continue to march higher, hitting a new all-time high near US$1265 this Monday morning in London trading before settling down to the $1250 to $1260 area. Reportedly, the catalyst to higher gold prices was the revelation that Saudi Arabia's central bank, the Saudi Arabian Monetary Authority (SAMA) had made a sizable addition to its official gold holdings in early 2008 but only recently chose to report this metal in its official central bank reserve accounts.

According to the latest statistics published by the International Monetary Fund reporting the foreign exchange and official gold holdings of its member countries -- and publicized last week by the World Gold Council, a pro-gold marketing association of many of the world's top gold mining companies -- the Saudi Arabian Monetary Authority increased its gold holdings by nearly 180 tons in the first quarter of 2008 from 143 tons to its current reported level of 322.9 tons.

In a footnote to its first-quarter 2010 report, the Saudi monetary authority said that its "gold data have been modified from first quarter 2008 as a result of the adjustment of the SAMA's gold accounts." It seems likely from the available evidence that the Saudi's bought all of this gold in the first quarter of 2008 -- but chose not to publicize or report the purchase until now, instead holding the bullion in a "non-reserve" account or possibly by the Saudi Sovereign Wealth Fund on behalf of SAMA.

We have long held the view that some of the oil-rich nations might be buying gold on the sly through their sovereign wealth funds that do not necessarily report their investment holdings. Why did SAMA choose not to report its gold purchases until now? We can only guess it feared aggravating relations with the United States since the U.S. Treasury and the Federal Reserve view gold accumulation by foreign central banks as a threat to the dollar's international reserve status. But with a number of other central banks either buying gold outright or surreptitiously and with U.S. policymakers already on the defensive, the Saudi's may no longer feel quite so obliged to tow the U.S. line.

The Saudi news is reminiscent of China's announcement in April 2009 that it had purchased some 600 tons of gold over the prior six years, more than doubling its holdings from 454 tons to the current reported level of 1054 tons. The Chinese have not reported additional gold purchases since then.

However, we (like many other gold-market observers) believe China's central bank continues to buy more gold month after month but chooses not to report these additions so as not to boost the market price as such an announcement would likely do. We would not be surprised to learn that SAMA continues to buy as well, but like the Chinese, chooses not to report its ongoing purchases in order to minimize the upward price pressure resulting from its gold-buying program.

Regardless, SAMA's golden revelation confirms our view that central banks around the world are adopting an increasingly favorable view of gold ... as their concerns about the U.S. economy and the U.S. dollar's long-term purchasing power continue to mount.

Among the central banks that have announced gold purchases in the past year or so are Russia, Kazakhstan, India, Venezuela, the Philippines, Sri Lanka, and Mauritius ... and it is likely that a number of other counties, including China and possibly other Mideast oil-rich states, are buying quietly without publishing or reporting their purchases.

Importantly, central bank purchases are no small potatoes -- and are already contributing to the yellow metal's continuing bull market run. Russia alone bought 117.6 tons last year and another 26.6 tons in this year's first quarter, while the Philippines purchased 9.6 tons and Kazakhstan 3.1 tons in the first three months of 2010.

Last year, the official sector (central banks and the IMF) reported net purchases of some 425 tons of gold. This came after two decades of net selling by the official sector of roughly 400 tons per year on average over the prior 20 years.

We think central banks as a group -- and a growing group, at that -- will continue building official gold reserves as a means of diversification and reducing exposure to U.S. dollar-related risks for years to come. This year, we conservatively expect that central banks as a group will buy -- and report -- some 150 to 300 tons -- and possibly much more counting unreported purchases.

To arrange an interview with Jeffrey Nichols, please contact Liz Cheek of Hill & Knowlton at (212) 885-0682 or [email protected]

About Rosland Capital

Rosland Capital LLC is a leading precious metal asset firm based in Santa Monica, California that buys, sells, and trades all the popular forms of gold, silver, platinum, palladium and other precious metals. Founded in 2008, Rosland Capital strives to educate the public on the benefits of investing in gold bullion, numismatic gold coins, silver, platinum, palladium, and other precious metals. For more information please visit www.roslandcapital.com.

About Jeffrey Nichols

Jeffrey Nichols, Managing Director of American Precious Metals Advisors and Senior Economic Advisor to Rosland Capital, has been a leading precious metals economist for over 25 years. His clients have included central banks, mining companies, national mints, investment funds, trading firms, jewelry manufacturers and others with an interest in precious metals markets.



    Contact: Liz Cheek
    (212) 885-0682
    [email protected]


SOURCE Rosland Capital LLC

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
Interoute has announced the integration of its Global Cloud Infrastructure platform with Rancher Labs’ container management platform, Rancher. This approach enables enterprises to accelerate their digital transformation and infrastructure investments. Matthew Finnie, Interoute CTO commented “Enterprises developing and building apps in the cloud and those on a path to Digital Transformation need Digital ICT Infrastructure that allows them to build, test and deploy faster than ever before. The int...
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
SYS-CON Events announced today that CrowdReviews.com has been named “Media Sponsor” of SYS-CON's 20th International Cloud Expo, which will take place on June 6–8, 2017, at the Javits Center in New York City, NY. CrowdReviews.com is a transparent online platform for determining which products and services are the best based on the opinion of the crowd. The crowd consists of Internet users that have experienced products and services first-hand and have an interest in letting other potential buyers...
SYS-CON Events announced today that T-Mobile will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. As America's Un-carrier, T-Mobile US, Inc., is redefining the way consumers and businesses buy wireless services through leading product and service innovation. The Company's advanced nationwide 4G LTE network delivers outstanding wireless experiences to 67.4 million customers who are unwilling to compromise on ...
@DevOpsSummit has been named the ‘Top DevOps Influencer' by iTrend. iTrend processes millions of conversations, tweets, interactions, news articles, press releases, blog posts - and extract meaning form them and analyzes mobile and desktop software platforms used to communicate, various metadata (such as geo location), and automation tools. In overall placement, @DevOpsSummit ranked as the number one ‘DevOps Influencer' followed by @CloudExpo at third, and @MicroservicesE at 24th.
Virtualization over the past years has become a key strategy for IT to acquire multi-tenancy, increase utilization, develop elasticity and improve security. And virtual machines (VMs) are quickly becoming a main vehicle for developing and deploying applications. The introduction of containers seems to be bringing another and perhaps overlapped solution for achieving the same above-mentioned benefits. Are a container and a virtual machine fundamentally the same or different? And how? Is one techn...
SYS-CON Events announced today that Infranics will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Since 2000, Infranics has developed SysMaster Suite, which is required for the stable and efficient management of ICT infrastructure. The ICT management solution developed and provided by Infranics continues to add intelligence to the ICT infrastructure through the IMC (Infra Management Cycle) based on mathemat...
SYS-CON Events announced today that SD Times | BZ Media has been named “Media Sponsor” of SYS-CON's 20th International Cloud Expo, which will take place on June 6–8, 2017, at the Javits Center in New York City, NY. BZ Media LLC is a high-tech media company that produces technical conferences and expositions, and publishes a magazine, newsletters and websites in the software development, SharePoint, mobile development and commercial UAV markets.
Have you ever noticed how some IT people seem to lead successful, rewarding, and satisfying lives and careers, while others struggle? IT author and speaker Don Crawley uncovered the five principles that successful IT people use to build satisfying lives and careers and he shares them in this fast-paced, thought-provoking webinar. You'll learn the importance of striking a balance with technical skills and people skills, challenge your pre-existing ideas about IT customer service, and gain new in...
SYS-CON Events announced today that Telecom Reseller has been named “Media Sponsor” of SYS-CON's 20th International Cloud Expo, which will take place on June 6–8, 2017, at the Javits Center in New York City, NY. Telecom Reseller reports on Unified Communications, UCaaS, BPaaS for enterprise and SMBs. They report extensively on both customer premises based solutions such as IP-PBX as well as cloud based and hosted platforms.
"I think that everyone recognizes that for IoT to really realize its full potential and value that it is about creating ecosystems and marketplaces and that no single vendor is able to support what is required," explained Esmeralda Swartz, VP, Marketing Enterprise and Cloud at Ericsson, in this SYS-CON.tv interview at @ThingsExpo, held June 7-9, 2016, at the Javits Center in New York City, NY.
SYS-CON Events announced today that Cloudistics, an on-premises cloud computing company, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Cloudistics delivers a complete public cloud experience with composable on-premises infrastructures to medium and large enterprises. Its software-defined technology natively converges network, storage, compute, virtualization, and management into a ...
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
SYS-CON Events announced today that Juniper Networks (NYSE: JNPR), an industry leader in automated, scalable and secure networks, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Juniper Networks challenges the status quo with products, solutions and services that transform the economics of networking. The company co-innovates with customers and partners to deliver automated, scalable and secure network...