Gold price heads up further amid concern over EU sovereign debt

10:12, November 10, 2010      

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Gold futures on the COMEX Division of the New York Mercantile Exchange carried bullish sentiment into Tuesday, hiking 0.5 percent to 1,410.1 U.S. dollars per ounce, as the concerns over EU sovereign debt has intensified. Silver also extended the 30-year record to a fresh high.

The most active gold contract for December delivery jumped 6.9 dollars, or 0.5 percent, to finish at a record high settlement of 1,410.1 dollars per ounce.

In the previous trading, the gold price topped the psychological mark 1,400 dollars and the market has witnessed four consecutive hikes, or a cumulative gain of 5.6 percent, since the Fed announced its second round of quantitative easing policy (QE2) on Nov. 3.

Market traders noted that the gold market is benefiting from safe-haven appeal as worries about European debt, particularly Irish bonds, have resurfaced.

Besides, the market's worry over inflation also helps buoy up the market, as the Fed's QE2 is set to spark inflation and investment in such commodities as gold could help hedge against inflation.

Statistics showed that the holdings in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion in the world, on Monday rose 2.4 metric tons to 1,294.2 tons, the first increase since Oct. 14.

December silver climbed 1.474 dollars, or 5.4 percent, to 28. 906 dollars, a fresh 30-year high.



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