Gold, platinum hit record highs on S.Africa

Veronica Brown
Reuters
Friday January 25, 2008

Gold and platinum prices hit record highs on Friday as power cuts shut South Africa's mines, including many of the world's biggest.

London Metal Exchange (LME) aluminum also jumped as the market tried to price in the possibility of falling supplies in the key global metals producer.

Oil and other base metals firmed, with worries about demand allayed for now as a U.S. tax stimulus package and the prospect of further rate cuts helped soothe fears of a looming recession.

Gold topped $920 per ounce while platinum hit a record $1,697 on the power crisis in resource-rich South Africa.

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The pit closures are the latest in a string of problems for the South African mining industry, which has been beset by closures due to fatal accidents and strikes over safety.

Supply concerns have been supporting platinum for months, reflected in rising lease rates for the metal.

An informal Reuters poll published earlier this week forecast the platinum market would stay in deficit in 2008, and 2009.

Analysts and investors said the prospect of further dollar weakness, due to expectations of more U.S. rate cuts next week, left precious metals well positioned to scale fresh heights.

Full article here.

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