Gold recaptures 1,400 USD on pause in dollar rally, strong demand

08:51, November 12, 2010      

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Gold futures on the COMEX Division of the New York Mercantile Exchange on Thursday recaptured the 1, 400 mark on pause in dollar after four consecutive hikes as well as increased demand for physical gold from Asia. The most active gold contract for December delivery inched up 4 U.S. dollars, or 0. 3 percent, to 1,403.3 dollars per ounce.

Market traders noted that the dollar rally was suspended as investors watched for currency signals from the Group of 20 leadership summit that began on Thursday in Seoul, capital of South Korea and thus, helped push up the gold price above 1,400 dollars again.

Besides, the active buying in the physical market in Asia gave a further push to gold sentiment. Scrap supply has increased a bit, but not enough to satisfy the demand for physical gold, said a gold trader in Chicago.

The increasing inflationary concern around the world also pushed more investors to such commodities market as gold to protect the value of wealth. China's CPI, a major gauge of inflation, hiked 4.4 percent year on year in October, the highest rise in the latest two years.

The Fed's quantitative easing policy would flush surplus liquidity to the global market, pushing up the commodities' prices, which, in turn, could prompt more funds in the gold market, said an analyst.

Silver also recouped a little from Wednesday's steep loss. December silver climbed 0.54 dollars, or two percent, to 27.405 dollars. Platinum also increased 7.9 dollars, or 0.45 percent, to 1,745.8 dollars per ounce.

Source: Xinhua


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