Tokyo gold futures rose on Thursday to their highest level in 12 years after prices in New York rallied to a 16-year high, although a soaring yen made investors wary of bidding up yen-based futures aggressively. The October contract on the Tokyo Commodity Exchange (TOCOM) rose as high as 1,505 yen per gram, the highest for the benchmark month since August 3, 1992 when prices marked a high of 1,509 yen.
At the close it was up five yen at 1,502. "The market drew strength from a bullish overseas market. But its rise was more gradual due to a strong yen," one broker said. He added that the benchmark contract was expected to approach 1,563 yen the peak for 1992 set on March 12 unless the dollar's downturn came to a halt.
Broad concerns about the declining US dollar have driven investors toward gold, which is viewed as a classic store of value when the US currency is under pressure.
The dollar sank to a record low against the euro and fell to its lowest level since March 2000 versus the yen on Thursday as traders played down the chances of joint market intervention by European and Japanese authorities.
The euro was buying around $1.3365, up from $1.3345 in late New York trade and just off the record high of $1.3375 hit in the day.
The dollar was at 102.20 yen after falling to 102.11, a 4-1/2 year low and down nearly half a percent from late trading in New York.
The market is focused on the ability of the United States to fund its budget and current account deficits, and on suspicions that Washington wants a weaker dollar to help fix the imbalance.
In New York, Comex February gold moved as high as $457.70 an ounce, the priciest for futures since July 1988, before settling at $455.90, still up $2.70 on the day.
Spot gold was at $456.10/65 an ounce, extending gains from New York's last-quoted $453.60/454.35. TOCOM platinum futures rebounded on Thursday buoyed by gains in New York and higher gold prices.
The benchmark October platinum contract ended up 15 yen per gram at 2,793, after trading between 2,785 and 2,805. Other months gained nine to 18 yen. Spot platinum was at $874.00/879.00 an ounce, unchanged from late New York.
Below are closing prices for TOCOM's most active precious metals contracts, with the day's turnover for each metal.