American Eagle gold coin 2012 sales down but outlook bright

* American Eagle gold coin sales hit lowest in 5 years

* Demand from Sept. to Dec. up almost 40 pct yr-over-yr

* US fiscal crisis, election uncertainties boost safe havens

NEW YORK, Jan 3 (Reuters) - Sales of U.S. American Eagle gold coins in 2012 were the weakest in five years despite a strong finish, hurt by declining price volatility and an improving U.S. economic outlook, dealers said. Investors bought 753,000 ounces of American Eagles produced million ounces, data from the Mint's website shows. It was also the lowest annual American Eagle gold coin sales since 2007, and the first time sales dropped below the 1 million ounce mark since 2008, during the worst global economic crisis since the Great Depression. Increased gold selling ahead of U.S. tax increases in 2013 and flat demand had prompted the Mint to lower coin output, said Edmund Moy, chief strategist of Morgan Gold, which offers U.S. retirement accounts that include precious metals coins and bars. Easing fears about the European debt crisis and signs of recovering U.S. job and housing markets also lessened demand for hard metals as a safe haven from economic turmoil. In 2012, gold ended up 7 percent for a 12th consecutive yearly gain. A steadier market with less volatile price swings dampened bullion buying interest by investors and speculators alike, coin dealers said. Competition from gold-backed exchange-traded funds and bullion coins such as the Canadian Maple Leaf and South African Krugerrand also affected U.S. demand, dealers said. Still, last year's gold coin sales exceeded the ten-year annual average of 676,000 ounces from 2002 to 2011, Mint data shows.

STRONG PERFORMANCE IN LATE 2012 In just the last four months of 2012, however, sales of the U.S. gold coins rose nearly 40 percent year-on-year on safe-haven demand due to political and economic uncertainties. "The U.S. election played a big role. And then we had the 'fiscal cliff' and everybody jumped on the bandwagon," said Terry Hanlon, president of Dillon Gage Metals, one of the largest U.S. bullion dealers. Hanlon said the pace of buying at the start of the new year was brisk. So far in the first week of 2013, the Mint has sold 57,000 ounces of American Eagles, its website shows, on track to be one of the strongest monthly sales on record. The Mint shut its 2012 coin production in early December so it could start minting the new year's edition, which is usually highly sought after by coin dealers and collectors.

Gold American Eagle coin sales (in ounces)

Jan. 2012 127,000 February 21,000 March 62,500 April 20,000 May 53,000 June 60,000 July 30,500 August 39,500 September 68,500 October 59,000 November 131,000 December 76,000

(Editing by Steve Orlofsky)