From The London Times…

Merrill Lynch predicted that gold would hit $600 an ounce in the long term after its recent rise above $500. Last month, the precious metal hit a 25-year high of $579.50 an ounce amid concern among investors that America's huge trade gap would force a weakening of the dollar. The Chancellor sold 395 tonnes of Britain's gold reserves between 1999 and 2002, generating $3.5 billion. At yesterday's London closing price of $554.10, he would have generated more than $7 billion (£4 billion)."

Looks like the Chancellor sold too early.