Gold ticked higher in volatile trade on Thursday, underpinned by improving investment appetite and gains in other commodities such as oil and metals and despite the dollar rising against the euro. Platinum touched its highest in six months as dollar weakness over the past couple of days prompted industrial and bargain-hunting buying, lifting palladium by nearly 6 percent to its highest in over four months.
But analysts said with sales sharply down in the auto sector, the main consumer of platinum, the rally lacked fundamentals to support it and was seen short-lived. Spot gold rose to $938.00 per ounce at 1541 GMT, up from $933.15 an ounce late in New York on Wednesday. Oil hit its highest in four months while copper surged 3 percent. "Money keeps pushing into commodities on concerns over the money supply in the United States," said John Meyer, head of resources at Fairfax.
"Gold is a popular place to be right now." Gold is used as a hedge against financial uncertainty and against inflation, which is expected to soar because of the vast amounts of money being piped into the global economy by central banks and governments. The US plan to buy long-dated Treasuries further raised those inflationary concerns and have also dented the outlook for the dollar, which in turn is supportive for bullion.
Spot platinum touched $1,159.00 an ounce, its highest since September 26 and was last at $1,1149.50 an ounce versus $1,120 an ounce late in New York on Wednesday. "The euro being stronger against the dollar has encouraged some industrial buying," said Commerzbank trader Rory McVeigh, referring to the dollar weakness over the last couple of weeks. "Not much but enough in a very thin market to lift it."
Platinums strength lifted sister metal palladium nearly 6 percent higher to $226.50 an ounce, its highest since November 11. It was at $220 an ounce versus Wednesdays $208.50 an ounce. Spot silver firmed to $13.66 an ounce from Wednesdays $13.45 an ounce. The SPDR Gold Trust, said its holdings remained at 1,124.99 tonnes on March 25, unchanged from the record hit the previous day.
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