Impact of globalization on the gold market Marino G. Pieterse publisher Gold letter International. MENA MINING Congress Manama, Bahrain October 26 - 29, 2009. Measuring the New Gold Bull Market. Gold does not run its own course as a safe haven. Demonetization of gold.
Marino G. Pieterse
publisher Goldletter International
MENA MINING Congress
October 26 - 29, 2009
■ Story of modern gold market begins with free float of gold in March 1968 central banks give up trying to defend a fixed gold price at $ 35 per ounce■ US Treasury closes “gold window” in April 1971 gold holdings of Europe central banks frozen■ IMF alters articles in 1978 to suspend gold as an ultimate means of settlement■ Central Bank Gold Agreements:first agreement (September 1999 – 2004) : sale quota of 400 tonnes per year, with anabsolute limit of 2,000 tonnes over the whole 5-year periodsecond agreement (September 2004 – 2009) - sale quota of 500 tonnes per year with an overall total of 2,500 tonnes over the whole 5-year periodthird agreement (September 2009 – 2014) – sale of 400 tonnes per year with an overall totalof 2,000 tonnes over the whole 5-year period (including IMF sale of 403 tonnes)■AsianCentral Banks don’t consider gold as a monetary instrument(as per July 2009)Gold holdings : 15 signatories + US: 19,983 tonnes 76%Major Asian countries 2,742 tonnes 10%Others 3,572 tonnes14% 26,297 tonnes 100%
Related to currency basket of the US dollar index
(57.6% in euro’s, 13.6% in Japanese yen, 11.9%
in British pounds, 9.1% in Canadian dollars, 4.2%
in Swedish crones and 3.6% in Swiss francs).
Since the index went up in 1995 from a long term
resistance level of 80 to a high of 120 in 2001, at
the time the euro was introduced, it dropped to a
low of 72 in March 2008, but has been followed by
a strong upward correction to $ 87 well above the
historic resistance level, before showing a new
correction to a current level of 77.
World Gold Mine Production (10-year comparison – in tonnes)