Gold hit a record high of $1,300 an ounce on Monday, extending a two-week rally of fresh records on concerns over an economic recovery, before easing off session highs as the dollar rose. Silver tracked the yellow metal higher, rising to a 30-year high but also slipped from the previous high. Silver has gained nearly 30 percent so far this year.
Fund managers and industry experts say gold's rally has further to run in the longer term, As it provides a hedge against inflation amid expectations that central banks world-wide could resort to quantitative easing to support their economies. But, some add that it may correct its rapid rise in the short term.
Spot gold changed hands at $1,297.30 an ounce by 1:19 pm EDT (1719 GMT), after hitting an historic $1,300 an ounce, up from $1,295.60 quoted late in New York on Friday. US gold futures for December delivery was up $0.70 an ounce at $1,298.80 an ounce, after rising earlier to $1,301.30, just short of an all-time high at $1,301.60 hit on Friday. Industry experts see fresh highs for bullion. Delegates at the London Bullion Market Association annual conference forecast a price of $1,406 an ounce by September 2011.
The world's biggest miner of the yellow metal, Barrick Gold said bullion could see above $1,500 an ounce next year. In the shorter term, charts show bullion's rally might face resistance around $1,315-1,325 an ounce. Silver jumped to its highest in three decades at $21.61 an ounce, but eased to $12.45 by the New York midday.
The world's largest silver-backed exchange-traded fund, the iShares Silver Trust, said its holdings rose to a record high at 9,613.02 tonnes by September 24 from 9,582.59 tonnes on September 23. Silver's main sources of demand are for use in industrial applications such as semi-conductors and jewellery. Spot platinum slipped to $1,630 an ounce versus Friday's last quote of $1,637.70 an ounce. Spot palladium was at $551 an ounce, down from $556.70 an ounce previously.
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