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Gold advances to record price as dollar weakens

Gold futures in Chicago and New York rose to a record on speculation that lower US interest-rates will weaken the dollar and spur inflation, while boosting the metal’s appeal as an alternative investment.

The US Dollar Index, which tracks the currency against six major counterparts, sank to the lowest since its start in 1973. The euro was little changed after earlier touching $1.5239, the highest ever. The US currency dropped below ¥104, to its lowest level since March 2005. The US economy expanded less than forecast in the Q4 as GDP rose at a 0.6% annualized rate. The feeble GDP figures reinforced sentiment that the Fed will have to lower interest rates in mid-March despite higher inflation. Gold futures for April delivery climbed $7.50 to $975 an ounce on the Comex division of the New York Mercantile Exchange. The price reached the record $978.5 an ounce in electronic trading overnight. (people.com.cn)