January 3, 2013, 10:15 a.m. ET

U.S. Mint Gold-Coin Sales Fell 25% in 2012
By MATT DAY

The U.S. Mint's gold-coin sales slid for a third consecutive year in 2012, as high prices and competition from other gold investment products limited demand for the coins.

The U.S. Mint sold 753,000 troy ounces of American Eagle gold coins in 2012, according to data posted on its website, down 25% from a year earlier and the lowest full-year sales since 2007.

The decline is likely the result of investors turning to gold coins made by other mints and to exchange-traded funds designed to track the price of the precious metal, said Miguel Perez-Santalla, a vice president with online precious metals exchange BullionVault. "Coin sales are down, but that doesn't mean that interest in precious metals is down."

The amount of gold held by ETFs hit a record high in 2012 above 85 million troy ounces, according to data from ETF Securities. Gold- and silver-focused ETFs proliferated amid rising interest in the metal during gold's 12-year bull market.

The U.S. Mint sells gold and silver coins in bulk to retailers, who in turn make the coins available to consumers. Because of the lag time between the mint sales and the purchase by the final consumer, market watchers typically view the figures as a gauge of dealers' expectations for investment demand in the coming months.

American Eagle coins are used primarily by investors who want exposure to gold or silver.

Sales of silver American Eagles in 2012 fell 15% from the previous year, the first annual decline since 2007, to 33.7 million ounces. In 2011, the mint sold 39.9 million ounces, the most since gold and silver eagle sales began in 1986.

Silver-coin sales have held up better than gold coins in recent years, since 2009 posting the three highest totals ever.

"Silver looks cheap compared to gold," Mr. Perez-Santalla said. "I think we've seen a lot more buying in silver because of that reason."

Benchmark gold futures on the Comex division of the New York Mercantile Exchange on Wednesday traded up 0.8% at $1,688.90 a troy ounce, 54 times silver's price of $31.05 an ounce.

Gold-coin sales peaked at 2,055,500 ounces in 1999. Sales declined sharply from there, averaging fewer than 400,000 ounces a year between 2000 and 2007 amid booming equities and real estate markets.

Sales climbed threefold with the arrival of the financial crisis in 2008 and rose a further 66% in 2009 to 1.4 million ounces.

Write to Matt Day at matt.day@dowjones.com

http://online.wsj.com/article/SB10001424127887323874204578219421777432536.html