While gold prices are down slightly as the U.S. dollar climbs, the metal is still well above $1,100 an ounce.
Investors who have driven the metal to a string of records appear not that interested in selling, as recent dips have been short-lived and shallow. The support for gold at the moment is broad, with buying coming not only from central banks and speculative investors but also from retail-level purchases.
In recent trading on the Comex division of the New York Mercantile Exchange, most-active December gold was down $2.40 at $1,139.50 an ounce while the ICE Futures U.S. Dollar Index was up 0.404 point at 75.697. Nearby November gold was down $1.80 at $1,139.60.
George Gero, vice president with RBC Capital Markets Global Futures, described the gold market as pausing after record highs.
"Prices remain elevated, and continue to feed off the positive momentum created by Asian central banks showing a growing appetite for increasing gold holdings," said Barclays Capital analyst Natalya Naqvi.
This month, the International Monetary Fund sold two metric tons of gold to Mauritius following India's purchase of 200 tons of the 403.3 tons the IMF had earmarked to sell. Sri Lanka has also been buying the metal.
Ms. Naqvi also noted the U.K. Royal Mint has reported strong gold coin production. She called it "evidence of strong retail interest in gold."
The U.S. Mint has also reported strong coin sales, while dealers say customers are snapping up gold bars and coins.
These retail investors, as well as the central banks and speculators--often shorter-term traders than other types of investors--are moving into gold primarily to get out of U.S. dollar holdings or to hedge what they see as potential future inflation.
