Gold futures climbed but settled below a 16-year high on Wednesday, buoyed by the dollar near a record low versus the euro and silver's jump to an eight-month peak above $8 an ounce. A burst of technical fund buying at the start of the month drove metal prices higher, dealers and analysts said. February delivery gold on the New York Mercantile Exchange's Comex division moved as high at $457.70 an ounce, the highest for futures since July 1988, before ending at $455.90, up $2.70 on the day.
The session low was $452.40. Investors have piled into gold and, to a lesser extent silver, amid concerns about the declining dollar, although volatility in crude oil and geopolitical tensions also has lent support.
"I thought we might be in for a bit more of a correction in gold after the last month, but the rally continues strongly," said Paul McLeod, vice president of precious metals at Commerzbank in New York.
Spot gold peaked at $455.20 on Wednesday, its loftiest level since June 1988, before slipping slightly. It last fetched $453.30/4.05, up from Tuesday's New York close at $450.50/1.25.
Physical demand for precious metals remains robust as well, especially on price dips, McLeod said.
"Silver had a very strong day, and I think it's getting ready to test the highs for the year, which I don't think many people expected to be seen," he added.
March silver closed 30.3 cents higher at $8.08 an ounce, after trading from $7.765 to $8.13. Spot silver jumped to $7.98/8.01, from Tuesday's late quote at $7.68/71. The peak this year for a nearby silver futures contract was $8.211 on April 11.
The dollar hit an all-time low versus the euro at $1.3335, before hovering at $1.3311 in the afternoon.
The dollar has lost almost a tenth of its value versus a basket of currencies in four months on concerns about the US current account deficit and speculation Washington is happy to see a weaker dollar.
January platinum rose $6.30 to $878.60 an ounce. Spot platinum hit $874.00/879.00. March palladium lost $1.55 to close at $211.55. Spot palladium traded to $208.00/214.00.
Comments
Comments are closed.