- South Korea central bank bought 14 tonnes of gold in Nov!
by Christine Kim, http://www.reuters.com/ , 5 Dec 2012
Bank of Korea increases gold reserves to 84.4 tonnes
* Gold holdings at 1.2 pct of total foreign reserves, up from 0.9 pct
South Korea’s central bank said on Wednesday it bought 14 tonnes of gold in November using its foreign reserves in order to spread its portfolio risks, while
releasing data showing total reserves rose after talk of market intervention.
The Bank of Korea bought the gold for $780 million, the fourth purchase in about one-and-a-half years and lifting the proportion of gold in its total foreign reserves to 1.2 percent from the previous 0.9 percent, it said in a statement.
“Gold is a physical, safe asset and allows (the country) to deal with changes in the international financial environment more effectively,” it said in a statement, without providing more details on the purchase.
The Bank of Korea now holds 84.4 tonnes of gold, valued at $3.76 billion in terms of purchase prices, up nearly six-fold from 14.4 tonnes before June last year. The Bank of Korea made its first gold purchase in more than a decade between June and July last year, joining some central banks in diversifying their increasing foreign reserves away from the U.S. dollar and low-yielding government bonds.
Official sector buying has become a key factor supporting gold demand and prices in recent years.
“It (South Korea’s gold buying) points to stronger support for gold prices from central banks,” said Philip Klapwijk, global head of metals analytics at Thomson Reuters GFMS, a metals consultancy.