Price for gold continues to slide downward, Guyana Gold Board still to cash more than 60 thousand ounces – 13th Jun 2013
With the price of gold on the world market now at 1385 US dollars at the end of business day on Thursday, if the Gold Board were to sell the gold that it had hoarded, then they can look at losing billions of Guyana dollars in the process.
Capitol News understands that the Gold Board uses the London fix to trade gold locally, which results in a loss of revenue for the Gold Board.
This practice is different from private licensed gold dealers who would normally hedge their gold on the New York Hedge funds.
One observer noted that the Gold Board would normally borrow tax payers’ money from the Treasury to buy the gold.
Prime Minister Sam Hinds who has cabinet responsibilities for the mining sector had earlier advised, that the Gold Board resells gold purchased immediately just putting on a minimum markup.
However this practice was not adhered to.
Another source said that persons within the industry were keeping their fingers crossed in hopes that the price of the metal would climb again from the low of US$1378 an ounce, it hit less than six weeks ago.
President Donald Ramator during a recent press conference said that a decision will have to be made on how his administration will handle the problem. He stated that his Government is studying the market very carefully and noted then that Government will seek technical advice on whether to sell off the gold currently in stock , or to hold on to the sale in the hope that the price will rise again.
Some of the factors which have caused this continuous decline in the price of gold are: the effects of the Cyprus bailout in the European Union (EU) and the selling of reserved gold by the Central Bank of that country. Guyana’s gold production has seen a massive increase within the past two years, and the gold industry is considered the fastest growing one in the country. The price of gold has however been described as being completely unpredictable.