US gold futures jumped 2.5 percent on Friday, breaking above $880 an ounce on a combination on strong investment demand and safe-haven buying due to currency market volatility and economic worries. Gold for February delivery was up $21.30, or 2.5 percent, at $880.10 an ounce at 10:34 am EST (1534 GMT) on the COMEX division of the New York Mercantile Exchange.
The range spanned $852.10 to $884.00. Currency volatility, including a big move of sterling against dollar, adding nervousness to markets, bolstering buying of gold as a safe haven, said Caesar Bryan, portfolio manager of $350 million GAMCO Gold Fund. Gold rallied despite the dollar rose to a 23-year high against sterling and six-week high against the euro.
Gold market sentiment bullish as the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, commonly known as GLD, said its bullion holdings jumped over 13 tonnes to record 819.11 tonnes of gold as of January 22. Individuals retail investors bought GLD as they realised the global financial crisis could last longer than they had expected, said Bryan.
February futures continued to ignore falling crude oil, which dropped $2 to under $42 per barrel on economic gloom. Gold futures outperformed crude oil contracts on Friday. Gold/oil ratio rose to 20.9, compared with 20.1 in the previous session. Spot gold was at $875.90 an ounce, up 2.4 percent from the last trade on Thursday.
March silver eased 4.5 cents to $11.320 an ounce as investors took profits after a rally in the previous two sessions. Ranged $11.260 to $11.645. Spot silver quoted at $11.30 an ounce, up 0.7 percent from its previous session close. NYMEX April platinum gained $5.60 to $940.50 an ounce on broad-based precious metals strength, but worries about the health of the auto sector could still weaken platinum group metals.
Spot platinum quoted at $931.50 an ounce, up 0.6 percent from its last finish. NYMEX March palladium rose $2.80, or 1.5 percent, $187.60 an ounce, tracking platinum's gains. Spot palladium quoted at $184.50 an ounce, up 1.4 percent from its previous close on Thursday.