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Gold near record, platinum hits historic high

Gold rose to $948.40/949.20 an ounce from $944.40/945.20 an ounce late in New York. On Thursday, it rallied to $953.60, its highest level ever, before a sharp decline in crude oil erased much of the day’s gains.

Dealers said the prospect of more rate cuts in the United States supported gold’s appeal as an alternative investment and kept the upward momentum intact. Bullion has risen as much as 14.4 percent so far this year.

Silver held near a 27-year high and palladium was within sight of a 6-1/2-year high.

‘The next probable stop in gold is around $955 and that is likely to be witnessed in coming days. Beyond that, $970 and $980 also seem possible,’ said Pradeep Unni, an analyst at Vision Commodities in Dubai.

Gold could also undergo a correction but a price dip would attract bargain hunting and buying interest from main consumer India ahead of the busy marriage season in April, when demand for gold jewellery picks up, he said.

‘The momentum is showing no signs of cooling and any pullback will ideally trigger fresh buying interest. The risk is quite high at such high levels but as long as gold trades above the $930 level, a major slide is unlikely.’

Crude oil extended falls on Friday, moving away from recent record above $101 a barrel, asgrowing inventories and weak economic data in the United Statesfuelled concerns that demand may soften in the world’s largest oil consumer.

Spot platinum jumped to a record high of $2,192 an ounce, up from $2,151/2,161 late in New York.

‘People are happy to buy at lower levels,’ said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong, adding that there were also purchases from auto makers.

‘We don’t know what the higher levels are, maybe $3,000 or $4,000. The only thing is that it seems people are happy to buy. That’s all,’ he said.

The most active NYMEX platinum contract for April delivery roared to a contract high of $2,214.5 an ounce, up from Thursday’s settlement of $2,188.20 an ounce.

Platinum, used in jewellery and auto catalysts, has jumped more than 40 percent this year after mines in South Africa, accounting for 80 percent of world output, were shut for five days at the height of last month’s power crisis.

South African power utility Eskom said it had contracted 30 million tonnes coal of the 45 million tonnes it needs over the next two years to help resolve a crippling power crisis.

The dollar was within sight of a two-week lows versus the euro after data showing the weakest regional factory activity since the last US recession in 2001 boosted expectations for a large Federal Reserve interest rate cut. [ID:nT8241]

Japanese platinum futures also hit new all time high. The most active December contract 0#JPL: on the Tokyo Commodity Exchange rose 155 yen per gram to 7,360 yen.

Palladium surged to $520/525 an ounce, from $510/515 an ounce, within sight of Thursday’s 6-1/2-year high of $525 an ounce.

Silver rose to $17.96/18.01 an ounce from $17.84/17.89 an ounce-not far from Thursday’s 27-year high of $18.03 an ounce.

Precious metals prices at 0542 GMT

MetalLastChange Pct chg YTD pct chg Turnover

Spot Gold948.203.90+0.4113.87

Spot Silver17.950.11+0.6221.53

Spot Platinum2191.0040.00+1.8644.14

Spot Palladium520.0010.00+1.9641.30

TOCOM Gold3299.00-1.00-0.037.81 55910

TOCOM Platinum7368.00 163.00+2.2638.00 34521

TOCOM Silver625.10-1.30-0.2115.55 1011

TOCOM Palladium 1845.0071.00+4.0036.57 16550

Euro/Dollar1.4802

Dollar/Yen107.45

TOCOM prices in yen per gram, except TOCOM silver which is priced in yen per 10 grams. Spot prices in $ per ounce.