Silver at 30-yr high, gold peaks

Sep 25, 2010 |

Reuters

London, Sept. 24: Gold rallied to record highs in Europe on Friday, with spot prices knocking on the door of $1,300 an ounce, as expectations grew that further quantitative easing could lead to volatility in the currency markets.

Spot gold hit an all-time high of $1,299.65 an ounce and was bid at $1,298.80 an ounce, against $1,293.50 late in New York on Thursday. US gold futures for December delivery GCZ0 hit a record $1,301.30 an ounce and were later at $1,300.10 an ounce, up $3.80. Silver also reached its strongest in 30 years at $21.41 an ounce, tracking gains in gold.

Gold has risen more than four per cent so far this month and hit record highs for five consecutive sessions to Wednesday, extending gains after the Federal Reserve indicated it may consider further quantitative easing, undermining the dollar.

“The US Federal Reserve is obviously contemplating, and the market is expecting, some kind of statement on quantitative easing,” said Deutsche Bank analyst Mr Daniel Brebner. “The influx of new money in the system raises longer term expectations for inflationary forces.”

Silver prices are also well-positioned after breaking through technical resistance at $21.20 and $21.35 to rally to their highest since 1980. It was later at $21.34 an ounce against $21.14.

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