Gold consumption by central banks grows

Worldwide central banks have been strengthening their gold holdings, according to published reports.

Turkey grew its holdings by 11.5 metric tons, Russia increased its holdings of the yellowish metal by 16.5 metric tons and Kazakhstan increased its possession by 4.5 metric tons, Bloomberg reports the International Monetary fund noted. But two increases in Latin America were of note: Mexico, owner of Latin America's most traded currency, grew its holdings by 16.8 metric tons; and Reuters reports Argentina, host of the
region's third-largest economy, strengthened its reserves by seven metric tons.

"To me the most interesting central banks headline this morning is that of Argentina," precious metal strategist Edel Tully with UBS told Reuters. "It's a new entry into the mix after a seven-year hiatus, its inflation is running at nearly 10 percent."

At 8:44 a.m. on Tuesday, gold futures increase 0.53 percent, an $8.60 lift to $1,641.20 per troy ounce.

In 2011, worldwide central banks purchased 439.7 tons of the yellowish metal, noting the biggest increase in almost 50 years. Similar amounts of bullion will be purchased this year, according to a forecast issued by the World Gold Council.

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