Nicholas Larkin and Pham-Duy Nguyen
Tuesday, Oct 6th, 2009
Gold rose to a record on speculation that inflation will accelerate and erode the value of the dollar, boosting the appeal of the precious metal for investors seeking to preserve their wealth.
Gold futures climbed as high as $1,038 an ounce in New York, topping the previous record of $1,033.90 in March 2008. The spot price headed for a ninth straight annual gain, the longest rally since at least 1948. The dollar dropped as much as 0.6 percent against a basket of six currencies. Copper, zinc and sugar have led a 2009 surge in commodity prices.
“Gold is acting like the ultimate currency,” said Chip Hanlon, president of Delta Global Advisors Inc. in Huntington Beach, California. “Central banks are following the same monetary course and trying to stimulate and inflate their way back to growth. Everyone’s concerned about the dollar but it’s not like you can hate the dollar and fall in love with the euro or the yen.”
Gold futures for December delivery traded $18.30, or 1.8 percent, higher at $1,036.10 an ounce at 9:08 a.m. on the Comex division of the New York Mercantile Exchange. Bullion for immediate delivery in London gained as much as 1.9 percent to a record $1,036.30 an ounce.