BLBG:U.S. Gold Coin Sales Slump as Prices Rebound on Asian Demand
U.S. Mint American Eagle gold coin sales that slowed each month since prices entered a bear market in April are set for an 87 percent drop in August from a year earlier at a time when physical demand climbed in Asia.
The mint sold 3,000 ounces of the coins so far this month, down from 209,500 ounces in April, its website shows. August sales may total about 5,077 ounces at the current pace, according to Bloomberg calculations, compared with 39,000 ounces in August last year.
Gold slid 19 percent this year as some investors lost faith in the metal as a store of value and on speculation the Federal Reserve will slow stimulus that helped the metal rally for 12 years. Bullion rebounded 15 percent from a 34-month low on June 28 as lower prices spurred physical purchases from China to Turkey. American Eagle coin sales were valued at $1.26 billion last year, based on a record average gold price.
“Some quite encouraging economic data of late out of the U.S.” may be slowing American coin demand, Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt, said today by phone. “People in Asia have clearly taken advantage of the lower gold price in recent months and bought huge amounts.”
Gold for immediate delivery traded at $1,362.67 an ounce by 10:17 a.m. in London, after reaching a two-month high of $1,384.55 yesterday. It reached a record $1,921.15 in September 2011, before slumping to as low as $1,180.50 in June. Prices surged 70 percent from December 2008 to June 2011 as the Fed bought more than $2 trillion of debt.
Coin Sales
American Eagle gold coin sales totaled 682,500 ounces this year, compared with 753,000 ounces in all of 2012. The mint, which said in April that it ran out of its smallest gold items, said in June that gold and silver coin sales may climb to a record this year.
Consumer demand for gold in India, last year’s biggest buyer, jumped 71 percent and China, the next-largest, gained 87 percent in the second quarter, helping to push global bar and coin purchases to a record, the London-based World Gold Council said Aug. 15.
Investors sold 684.2 metric tons of gold from exchange-traded products this year, equal to about three months of mine supply, according to data compiled by Bloomberg and Barclays Plc. ETP assets reached a three-year low of 1,946.9 tons on Aug. 8 and are down 26 percent this year.
To contact the reporter on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
