"The I.M.F. announced that 32 tonnes of gold was sold by them in September. This included the 10 tonnes to Bangladesh. This leaves around 71 tonnes left to go and we have passed October now. If they sold a similar amount in October then we are down to just below 40 tonnes remaining for sale by the I.M.F. If they continue this pace of selling they will only be left with less than 10 tonnes to sell in December and will complete their sales before the end of this year.
We have no reason to believe that the central banks in the emerging world will then cease buying, so where will they get future stock from? These buyers are not price sensitive, so will have to attempt to buy in the open market, where they cannot buy their own local production. If more central banks than are present now in the open market arrive, they will not be able to use the 'limit' order system to buy gold only when offered. The bullion banks will be able to ask for better offers simply by placing it in the gold Fixing and waiting for the best offer to arrive. This will turn central bank buyers from 'passive' buyers into 'active' ones..."
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