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US Mint to Introduce 24-Karat Gold Bullion Investment Coin in 2006
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(April 19, 2005) The US Mint this morning announced the coming of a new gold sales program featuring 99.99% pure gold bullion coins. The Mint's current gold Eagle bullion coin, which in its 20-year history has come to dominate the domestic bullion market, is struck in 22-karat (91.67% pure) gold.
The US Mint's gold bullion efforts, up until today, have revolved around the traditional coinage alloy of 22-karat gold. Old-timers will remember the American Arts Series of 22k gold bullion medals that the Mint produced from 1980-1984. In 1985, when the anti-apartheid ban on South African products prevented the further importation of South African Krugerrands, Congress passed legislation directing the US Mint to produce 22k bullion coins so that investors would have an American gold coin to take the place of the Krugerrand.

The Mint has long been aware of the world-wide popularity of 24-karat bullion coins, and in an attempt to grab a larger share of the world bullion coin market, obtained legislative permission to strike such coins years ago. It wasn't until this morning that the US Mint actually announce how soon that might happen.

Will this new issue be a substitute for the current gold Eagle? In a brief telephone conversation with Mint spokesman Michael White this morning, he answered, "We intend to continue production of the 22-karat gold Eagle in the foreseeable future."

The text of the April 19th, 2005 press release follows:

WASHINGTON – The United States Mint is announcing today that it will develop a program to manufacture 24-karat (99.99% fineness) uncirculated gold bullion investment coins in early 2006. This will mark the first time that the United States Mint will produce 24-karat gold coins. Upon completion of a successful test strike, the designs, specifications, quantities and denominations will be considered.

Possible themes for the images on the 24-karat gold bullion coins will be presented by teleconference at the April 28, 2005 meeting of the Citizens Coinage Advisory Committee at the United States Mint in Washington. The potential global market for 24-karat gold bullion coins is estimated at $2.4 billion.

“The United States Mint intends to match and exceed world class business practices with this new 24-karat gold bullion coin,” said Director Henrietta Holsman Fore. “There is a demand, both here and abroad, for 24-karat gold coins. We want to meet this demand by providing the highest quality and most beautiful coins in the world, the standard that investors and collectors have come to expect from the United States Mint.”

It is expected that the program will have two phases, starting with an investor-grade uncirculated 24-karat gold bullion coin, followed by a 24-karat numismatic collector proof coin. The Treasury Secretary would approve the designs, denominations and quantities of the coins.

The United States Mint is currently the world’s largest manufacturer of 22-karat (91.67% fineness) gold bullion investment coins, as well as silver and platinum bullion coins. The United States Mint’s 22-karat American Eagle gold bullion program will continue. The 22-karat American Eagle is the world’s top gold bullion coin with 95% of sales occurring in North America. However, there is an international market for a 24-karat coin, which is becoming the industry standard.

The United States Mint intends to produce the new 24-karat gold bullion coins for both domestic and foreign investors, coin and precious metal dealers, banks, brokerage firms and other companies, who would obtain them through authorized purchasers. The United States Mint approves authorized purchasers after ensuring that they have met rigorous standards.

Purchases of foreign-minted 24-karat gold coins represent almost a third of all gold bullion coins purchased annually in the United States market. Currently, 60% of all global bullion sales are of 24-karat gold products.

 

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