Gold peaks on weak US currency

Prices of precious metals continued to scale to new highs in the international market, tracking which the domestic market zoomed to record prices.

Gold in the London spot market marked a high of $965.70 an ounce on Wednesday.

While gold in the domestic market was quoted at Rs 12,345 per 10 gm.

Silver which zoomed past to $ 19.51/oz up on Wednesday in the international market boosted the local prices to a record Rs 23,765 per kg. In a lighter vein, a bank official said: “Thank God, we don’t sell silver, as we would not have been able to sell at such high prices.”

“Fear (concerning the US economy) leading to investment is driving gold at the moment, and lower interest rates also help,” said Mr Paul Walker, CEO of GFMS, a London-based precious metals consultancy.

Poor economic data coming from the US and the weakening dollar is supporting the rally in the gold prices, said a bank official.

Dollar weakened below $1.50 per euro for the first time. There has been speculation that the US Federal Reserve will indicate that it is ready to cut interest rates from a three-year low, an analyst said.

The dollar also dropped against 15 of the 16 most-active currencies today. It reached a 23-year low against the New Zealand dollar while it fell the most against Taiwan’s dollar and South Africa’s rand as investors bought higher-yielding currencies, he added.

News Source : Samachar