26 Sep 2008

Demand surges for gold coins

11:51 am on 26 September 2008

A surge in demand for gold is impacting on the US Mint.

It announced on Thursday it was temporarily suspending sales of American Buffalo 24-karat gold one-ounce bullion coins because strong demand has depleted its inventory.

The Mint said it would work to build up its inventory to resume sales shortly.

Earlier, a shortage of American Eagle one-ounce gold coins due to "unprecedented" demand also forced the Mint to temporarily suspend sales of the popular coins in mid-August.

The Mint said it would continue to supply the American Eagle 22-karat gold one-ounce and American Eagle silver bullion coins on an allocation basis to coin dealers.

Coin dealers in the United States and Canada have recently reported a surge in buying of bullion coins and other gold products as troubles in the financial markets prompted people to seek a safe haven in precious metals.

On Thursday, the US gold contract for December delivery ended down $US13 or 1.5% at $US882 an ounce on the COMEX division of the NYMEX. Spot gold traded at $US873 an ounce.

Bullion hit an all-time high of $US1,030.80 an ounce on 17 March.