LONDON, SEPT 21: The Bank of England sold 804,000 ounces of gold at $255.75 per ounce on Tuesday, a price slightly above dealers' expectations for the second of a series of auctions to cut 415 tonnes from Britain's 715-tonne reserve holdings.The sale was eight times oversubscribed with a scaling factor of 58.5353 per cent applied to successful bids at $255.75, the Bank of England said. Gold has yet to recover from the slide seen after Britain's first sale on July 6, when prices dropped from $261.20 to a series of 20-year lows that reached a floor of $251.70 on August 25.However, the auction drove gold prices up by more than $1.00 after the result was announced. The gold sold for $255.75 a troy ounce netted Britain $206 million for reserve investments in dollars, euros and yen. Demand exceeded the 25 tonnes on offer eight fold. The high level of bids and the price achieved both surprised dealers, who had predicted a sale price of around $255 or just below."First impressions, without looking at thedetails, will suggest it is a very good result for the Bank of England," Mitsui Global Precious Metals Analyst Andy Smith told Reuters Television. "It suggests a much higher take-up from the first auction, which at least had novelty value," he added.Britain suffered severe criticism from producers, producing countries and opposition politicians when it unveiled the auction proposal in May, a move which knocked prices down more than 10 per cent. It plans to cut altogether 415 tonnes from UK holdings, with the next two auctions to be held on November 29 and January 25.Indian gold steadyMUMBAI: The auction by the Bank of England (BoE) failed to have any immediate impact on the local bullion market as the yellow metal managed to hold steady. BoE today auctioned 25 tonnes of gold at the second of the five auctions at an allotment price of $ 255.75 per troy ounce.Standard gold at Rs 4050, 22-carat gold at Rs 3745 and ten-tola gold bar (.999 purity) at Rs 47,500 held steady.Silver, however,showed a weak trend as ready silver (.999 fineness) declined further by Rs 15 to end at Rs 7970 from yesterday's close of Rs 7985. Raw silver (.916 fineness) fell by Rs 20 to Rs 7840 from Rs 7860 and tenderable silver dropped to Rs 7975 from the previous close of Rs 7990.
