Gold climbed(COMEX:GCM14) for the first time in three days in London on speculation the new Indian government will relax import restrictions on the metal. Bloomberg Reported that incoming Indian leader Narendra Modi told thousands of supporters over the weekend that he represented a break from past governments after winning the nation’s biggest electoral mandate in 30 years. The new India finance minister will decide on easing gold import curbs, Reserve Bank of India Governor Raghuram Rajan said last week. China overtook India last year as the world’s biggest gold buyer.
Dow Jones reported that ‘central banks in the Eurozone, Switzerland and Sweden have agreed to coordinate their gold transactions and have no plans to sell "significant" amounts, the European Central Bank said Monday. The five-year agreement will apply from Sept. 27, when the current accord on gold dealings by the central banks expires. The aim is to keep any transactions by the central banks—which all have big gold holdings—from disrupting the market. Unlike the current agreement, which was signed in 2009, the new accord doesn't set a ceiling on gold sales. However, the banks involved haven't been large sellers of gold in recent years. "Gold remains an important element of global monetary reserves," the ECB said in a statement. "The signatories will continue to coordinate their gold transactions so as to avoid market disturbances." The agreement among some of Europe's key central banks has been in place since 1999. The rationale is that, with central banks typically being large holders of gold, it is necessary to coordinate any transactions so as to prevent volatile swings in the gold market.
Dow Jones reported that World Gold Council says the renewed co-ordination agreement on gold transactions by central banks in the Eurozone, Switzerland and Sweden "reasserts the importance of gold as an asset in global monetary reserves." The five-year agreement applies from Sept. 27, when the current accord expires. The aim is to keep any transactions by the central banks—which all have big gold holdings—from disrupting the market. The decision to remove a quantitative ceiling for annual gold sales also suggests that central bank gold sales are "essentially complete," says the World Gold Council, an industry. “The signatories note that, currently, they do not have any plans to sell significant amounts of gold,” according to the agreement announced by the ECB. “Gold remains an important element of global monetary reserves.”