Gold futures closed with gains Wednesday, reversing early losses, as the metal’s appeal as an inflation hedge and a safe haven continued to draw investment demand. Gold has touched a record 13 times this year and jumped to $945.60.
Gold for April delivery rose $8 to end at $937.80 an ounce on the New York Mercantile Exchange. “Gold is now extremely well-placed to set a fresh record high as investors continue to seek the metal’s anti-inflationary and safe-haven attributes,” said James Moore, an analyst at TheBullionDesk.com, in a note. Gold, which is typically seen as an inflation hedge, gained Wednesday after the Labor Department reported that US consumer prices rose a seasonally adjusted 0.4% in January. Inflation was stoked by large increases in energy and food prices but also showed increases in a host of underlying core prices.
Further adding to inflationary fears, crude futures extended their record-breaking run higher. Crude oil for March delivery rose 73 cents to finish at a new record closing high of $100.74 a barrel. Earlier in the session, the March contract, which expired Wednesday, hit a record all-time high of $101.32 a barrel
Gold has touched a record 13 times this year and jumped to $945.60 an ounce yesterday as crude oil rose to $101.32 a barrel, the highest since trading began in 1983 on the New York Mercantile Exchange. Some investors buy bullion as a store of value at times of inflation pressures. “It seems gold is gathering steam and $1,000 an ounce is not far off, with inflation picking up,” Greg Canavan, analyst at Fat Prophets Management Ltd., said by phone from Sydney today. US interest rates also look likely to fall again in March, he said. “Nothing is more bullish for gold.” (Marketwatch, Bg)