Spot gold hit its highest level since mid January on Wednesday, while bullion denominated in euros struck a record as investors, worried by Greek fiscal problems, picked up hard assets. Spot gold peaked at $1,147.95 an ounce, its highest since mid-January, and was bid at $1,143.55 an ounce at 1514 GMT, against $1,133.20 late in New York on Tuesday.
-- Palladium at 2-year highs, platinum at firmest in 20 months
Buying on the spot market escalated after prices reached a range between $1,336 and $1,142, traders said. Euro-priced gold hit a record high of 858.98 euros an ounce, and was later bid at 857.60 euros against 846.04 euros late on Tuesday. Also boosting prices, the euro hit its lowest in more than a week against the dollar on renewed concerns over Greece's ability to tackle its debt crisis.
"There's a lot of investment buying because of the Greece issue and with gold going above $1,336 there have been some technical stops triggered," said Standard Bank analyst Walter de Wet, adding robust physical demand was also boosting prices. Traders report Indian jewellers are stocking up for the wedding season in the world's largest gold consumer. Other precious metals also rose, with palladium hitting a two-year high.
US gold futures for June delivery on the COMEX division of the New York Mercantile Exchange rose $8.6 to $1,144.6 an ounce. Gold prices are also being supported by expectations interest rates will remain low for an extended period, which will keep the opportunity cost of holding gold low.
Among other commodities, platinum group metals also benefited from expectations for an economic recovery, with dealers reporting good demand for palladium in particular from Japanese carmakers. Platinum and palladium are primarily used in catalytic converters, but both have also seen significant investment interest this year. Platinum hit its highest since August 2008 at $1,723 an ounce and was later at $1,708.50 an ounce against $1,697.50. Palladium hit a two-year high at $511.50 and was later at $503.50 against $504.50.
"Palladium, platinum and silver actually have been gaining on gradually improving fundamentals alongside other industrial metals," said VTB Capital analyst Andrey Kryuchenkov in a note. Silver was at $18.07 an ounce versus $17.88, having earlier hit $18.20, its highest since late January.
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