September 14, 2009 / 3:35 PM / 10 years ago

Central banks seen becoming net gold buyers-expert

DENVER, Sept 14 (Reuters) - Central banks are expected to buy 6 million to 10 million ounces of gold annually due to currency uncertainties after being net sellers in past decades, Jeffrey Christian, managing director of CPM Group, told the Denver Gold Forum on Monday.

In a keynote speech kicking off North America’s biggest gold conference, which runs through Wednesday, Christian gave what he said was a conservative forecast for gold to average $914 an ounce over the next 10 years. Spot gold XAU= was trading at around $1,000 on Monday.

“What we are seeing is that central banks are making the transition from large net sellers to large net buyers,” Christian said.

“You will see a net buying of 6 (million) to 10 million ounces per year by central banks, and that is an extremely conservative projection,” he said.

Christian said that European central banks appeared to be done with their gold selling, and that central banks in emerging countries which have been building up foreign reserves were now diversifying into gold due to volatility in the dollar and other major currencies.

Recently, China and other emerging economies have signaled growing interest in gold rather than stockpiling their currency reserves in U.S. dollar-denominated assets. (Reporting by Frank Tang; editing by Jim Marshall)

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