* Gold above $1,190 after IMF sells gold to Sri Lanka
* India's central bank may consider more gold buys -report
* US Mint suspending sales of American Eagle gold coins
(Recasts, updates prices, market activity; adds second byline,
dateline, previously LONDON)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, Nov 25 (Reuters) - Gold prices hit record
highs above $1,190 an ounce on Wednesday as the dollar fell
sharply and the market expected central banks from emerging
economies to keep buying bullion from the International
Monetary Fund (IMF).
Gold prices have risen nearly 15 percent since the
beginning of November, on a combination of central bank
interest to diversify into the metal, a steadily falling U.S.
dollar and inflation worries.
Late on Wednesday, the IMF said it had sold 10 tons of gold
to the Central Bank of Sri Lanka. []
"We have had relatively supportive news from the central
banks, particularly in Asia, confirming that there is demand
for gold as a means of diversifying their large foreign
exchange reserves," RBS Global Banking & Markets analyst Daniel
Major said.
"There is plenty more potential for central banks to buy
either IMF gold or other gold in the market to try and boost
their reserves," he added.
Investor sentiment was bullish, highlighted by the news
that the U.S. Mint said it was suspending sales of the popular
American Eagle one-ounce gold bullion coins due to strong
demand. []
Spot gold <XAU=> hit a high of $1,190.20 an ounce and was
at $1,189.65 an ounce at 3:39 p.m. EST (2039 GMT), against
$1,168.90 late in New York on Tuesday.
U.S. December gold <GCZ9> settled up $21.20, or 1.8
percent, at $1,187 an ounce on the COMEX division of the New
York Mercantile Exchange.
India's Financial Chronicle newspaper said India is open to
buying more gold from the International Monetary Fund, which
has around another 200 tonnes to sell. The IMF had no comment
on the report. []
The market is sensitive to speculation of further official
sector buying after news in early November, that India's
central bank had bought 200 tonnes of gold from the IMF,
sparked a rally.
Russia, Sri Lanka and Mauritius have also previously
announced gold acquisitions, and traders speculate that more
central banks, particularly in Asia, could be open to gold
acquisitions to diversify their foreign exchange reserves.
CENTRAL BANK DIVERSIFICATION
Expectations for further reserve diversification, as well
as prospects for further dollar weakness and fears over
inflation in 2010 have all fuelled investment demand for the
precious metal, and could lead to further sharp prices gains.
Gold received a boost as the dollar fell to a 15-month low
against the euro due to views that U.S. rates would stay low
and as Russia said it would diversify currency reserves []
Dollar weakness helped lift other commodities. Oil prices
rallied $2 and industrial metals prices climbed. [] []
Silver <XAG=> was at $18.79 an ounce versus $18.49.
Holdings of the world's main silver ETF rose 136 tonnes to a
record 9,252 tonnes on Tuesday, while ETF Securities' silver
exchange-traded product also hit record levels. []
Platinum <XPT=> was at $1,473.50 an ounce against
$1,444.50, while palladium <XPD=> was at $371.30 against
$366.35.
Close Change Pct 2008 YTD
Chg Close % Chg
US gold <GCZ9> 1187.00 21.2 1.8 884.3 34.2
US silver <SIZ9> 18.768 0.313 1.7 11.295 66.2
US platinum <PLF0> 1479.50 35.70 2.5 941.50 57.1
US palladium <PAZ9> 370.95 1.70 0.5 188.70 96.6
Prices at 3:41 p.m. EST (2041 GMT)
Gold <XAU=> 1189.80 20.90 1.8 878.20 35.5
Silver <XAG=> 18.80 0.31 1.7 11.30 66.4
Platinum <XPT=> 1471.00 26.50 1.8 924.50 59.1
Palladium <XPD=> 371.30 4.950 1.4 184.50 101.2
Gold Fix <XAUFIX=> 1179.75 3.25 0.3 836.50 41.0
Silver Fix <XAGFIX=> 18.63 6.00 0.3 14.76 26.2
Platinum Fix <XPTFIX=> 1469.00 6.00 0.4 1529 -3.9
Palladium Fix<XPDFIX=> 375.00 2.00 0.5 365.0 2.7
(Reporting by Frank Tang; Editing by David Gregorio)
((frank.tang@thomsonreuters.com; +1 646 223 6126;
Reuters Messaging: frank.tang.reuters.com@reuters.net))
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