Gold jumps to record on weakening dollar
By: Nicholas Larkin and Pham-Duy Nguyen
Bloomberg News
November 23, 2009
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Gold jumped to a record price as the slumping dollar boosted bullion’s appeal as an alternative asset.
Gold futures touched an all-time high of $1,174 an ounce in New York, after the dollar fell as much as 0.9 percent against the euro. Gold has posted records during nine sessions this month, and is up 32 percent this year as investors and central banks increased their holdings of the metal to preserve wealth. Russia’s central bank said it bought more bullion last month.
“All this buying shows no confidence in the dollar,” said Bernard Sin, the head of currency and metals trading at bullion refiner MKS Finance SA in Geneva.
In other market, copper rose to a 14-month high on the falling dollar, and soybeans and corn fell. The UBS Bloomberg Constant Maturity Commodity Index gained 0.3 percent to 1,270.87.
Gold futures for December delivery rose $17.90, or 1.6 percent, to $1,164.70 an ounce on the New York Mercantile Exchange’s Comex division, the biggest gain in a week.
Gold may surge to $1,500 an ounce over the next 18 months, Bank of America Merrill Lynch analysts said today in a report.
Governments, the biggest holders of gold, have been expanding their bullion reserves, helping to spur an 8.3 percent rally in the metal’s price from Oct. 20 to Nov. 20. India’s central bank bought 200 metric tons from the International Monetary Fund in October. Mauritius and Sri Lanka also have been buying gold. The IMF still has about 200 tons left to sell.
