US gold futures rose above $1,120 an ounce on Monday, gaining more than 2 percent, on an oil price rally and dollar decline amid economic optimism on the first trading day of 2010. Gold for February delivery up $25.20, or 2.3 percent, at $1,121.40 an ounce on the COMEX division of the New York Mercantile Exchange by 10:25 am EST (1525 GMT).
Ranging from $1,093.80 to $1,124.60 - the highest price since December 17. Gold futures rose sharply as crude oil's sharp gains boosted the metal's appeal as a hedge against inflation, said traders. Dollar stayed lower against the euro after key US manufacturing data, lifting gold demand. Gold's strong performance in euro terms signalled a bull market, said Dennis Gartman, publisher of the Gartman Letter.
A close above $1,113 will be a bullish development, opening the way for $1,141 in the short term, said CitiFX. Bullion supported as US crude futures rose 2.5 percent to $81 a barrel due to cold weather in the United States. Gold/oil ratio at 13.78, against its previous session's 13.82. COMEX estimated 10 am volume at 116,593 lots. Spot gold at $1,120.55, against the previous session's late quote of $1,096.35 an ounce.
March silver up 62.5 cents, or 3.7 percent, at $17.47 an ounce, up with gold. Range from $16.850 to $17.535 an ounce. COMEX estimated 10 am volume at 21,172 lots. Spot silver at $17.42 an ounce, versus the previous session's late quote at $16.84 an ounce.
NYMEX April platinum up $49, or 3.3 percent, at $1,520 an ounce on strong investor sentiment driven by expectations of the launch of the first US platinum exchange traded fund. Spot platinum was at $1,511.50 an ounce. March palladium up $11.75, or 2.9 percent, to $420.60 an ounce on strong investment buying. Spot palladium was at $415 an ounce.
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