* SPDR Gold Trust lost 142 T in gold valued at $6.6 bln
* American Eagle gold coins up 10 times yr/yr to 209,500 oz
* Dealers report 20 pct premium per US silver coin
By Frank Tang
NEW YORK, May 1 Gold's historic sell-off last
month has intensified a disconnect between funds which sold on
dissatisfaction over bullion's underperformance and individual
investors who could not get enough physical gold coins and bars
at bargain prices.
In April, holdings at the world's largest gold-backed
exchange-traded funds (ETFs) the SPDR Gold Trust
posted their biggest monthly outflow in tonnage
terms in 8-1/2 years.
In contrast, sales of the U.S. Mint's American Eagle gold
coins rose to their highest monthly tally since December 2009.
While equities ETFs are often used by longer-term retail
investors, high-profile hedge fund managers, including John
Paulson and other institutional investors, are by far the
biggest shareholders of gold ETFs.
"It's been primarily the financial component that has been
selling. I don't think that we have seen a lot of small holders
changing their view on gold," said Nicholas Johnson, a portfolio
manager who helps manage the $30 billion in commodities at PIMCO
in Newport Beach, California.
Johnson said he expects tremendous Asian buying on dips and
demand by central banks there to more than offset
fast-money-type selling by Western financial institutions.
Bullion held by the SPDR Gold Trust dropped by around 143
tonnes in April from March - valued at $6.6 billion at
Wednesday's prices - for its biggest monthly decline since its
launch in November 2004.
It now held 1,078.5 tonnes of gold, the lowest level since
2009, versus 1,221.26 tonnes at the end of March.
Gold prices had dropped $225 per ounces between April
12 and 16 on fears of a withdrawal of the Federal Reserve's
monetary stimulus and after the European Central Bank and the
International Monetary Fund asked Cyprus to sell reserves as
part of a bailout deal.
GOLD, SILVER COINS FLYING OFF SHELVES
In contrast, gold coins and bars, favorites by longer-term
individual investors who want to gain exposure to the precious
metal, soared after gold's spectacular sell-off.
Shops selling gold coins, jewelry and bars around the world
reported an unprecedented surge in demand and mints and
refineries were working over time to keep up.
Sale of the American Eagle gold coins, jumped 10 times
year-over-year in April to 209,500 ounces, the highest level
since December 2009, U.S. Mint data showed.
In the first four months this year, sale of the U.S. gold
coins increased to 502,000 ounces in 2013 from 116,200 ounces in
the same period last year.
The strong performance came even after the U.S. Mint had
suspended sales of its one-tenth ounce gold coins last week as
surging demand depleted its inventory.
New Orleans-based retail coin dealer Blanchard & Co said
huge demand from both new and existing clients boosted its April
American Eagle gold coin sales up 400 percent versus March's.
In addition, the Mint's American Eagle silver coin sales
also climbed to over 4 million ounces in April from around 1.5
million ounces in the same month in 2012.
Dealers reported as much as $5, or a 20 percent premium per
one-ounce American Eagle silver coin, partly due to a lack of
coin blanks and production lag as U.S. Mint has been rationing
them after a brief halt in January.