In a communiqué from Bloomberg the central banks recent gold sales and planned sales for the future are weighing heavily on gold.

The article quotes Natalie Dempster who is the investment manager at the London based World Gold Council as saying:

“European central banks have sold 342.4 tons of gold as of July 20 under an agreement that caps annual sales at 500 tons through 26 September 2007.”

If that is correct then the central banks can still sell another 157.6 tons through August and September, which equates to around 18 tons per week. The other side of the coin of course is that the more savvy Asian banks could well mop up this amount of gold without the market being too badly damaged. After all gold has managed to rise despite these on going ‘giveaways’ by the central banks.

This is not something new although it could well hamper the progress of gold prices. So, we remain as bullish as ever and should the opportunity present itself in the form of a bargain, then we will add to our current position.