Gold futures in New York rallied to a quarter-century peak above $630 an ounce on Wednesday, and silver jumped over $14 for the first time since 1983, as high oil prices and a choppy US dollar accelerated inflow into precious metals as an alternative investment
Analysts said money was speeding into gold and other metals as momentum for higher prices looked strong and as investors sought out "safe-haven" markets amid global economic and political uncertainty.
"The trend is your friend, and I think everyone is just jumping on the bandwagon," said Carl Birkelbach, president and chief executive of Birkelbach Management Corp "Prices of all metals have gone up."
Gold for June delivery on the New York Mercantile Exchange's COMEX division soared $9.40, or 1.5 percent, to $632.70 an ounce by 10:43 am EDT - the steepest price for futures since December 1980.
Gold rocketed up at midmorning as the dollar gyrated against other currencies in volatile trading after stronger-than-expected US consumer price data. COMEX gold volume was a brisk 22,000 contracts at 10 am, spot gold surged as high as $629 before trading at $626.90/627.60 an ounce, versus $620.20/1.00 late on Tuesday.
Expectations for rising investment demand bolstered the silver market, as did a rally in base metals. Copper prices shot to a new record, piercing $6,500 a tonne in London, and aluminium and zinc also soared.
COMEX May silver raced up 55.5 cents, or 4 percent, to $14.34 an ounce, in a range of $13.81 to $14.4750. Silver last traded at these heights in January 1983. Spot silver rose to $14.44/14.47 an ounce, up from $13.91/13.94 previously. The fix hit $14.27.
NYMEX July platinum set a record at $1,137 an ounce and then traded up $7.90 at $1,131. Spot platinum shot to a record $1,121, then edged to $1,117/1,122.
June palladium gained $8 to $373 an ounce, after reaching $375.10 - a peak since September 2002, when futures got as high as $380.
Spot palladium reached $375 before trading up at $365/370 an ounce.
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