Gold on record breaking spree, sets new peak
Gold prices today rallied to a record high of $1,094 an ounce in overseas markets on aggressive buying by traders, who are speculating that more countries would shore up their bullion reserves like India.business Updated: Nov 04, 2009 16:59 IST
Gold prices on Wednesday rallied to a record high of 1,094.40 dollar an ounce in overseas markets on aggressive buying by traders, who are speculating that more countries would shore up their bullion reserves like India.
The metal which had been on a rising spree since last few sessions gathered momentum after the Reserve Bank purchased 200 metric tons of gold from the International Monetary Fund, raising fears that more governments might follow suit.
The precious metal also strengthened in trading in London and New York on a weaker dollar that boosted the metal's appeal as an alternative investment.
The gold for spot trading climbed as much as 8.70 dollar, or 0.8 per cent to 1,094.40 dollar an ounce in London. The metal surged 2.4 per cent yesterday.
The precious metal in futures trading on the New York Merchantile Exchange traded higher at 1,093.70 dollar.
Analysts said RBI's purchase of gold from IMF "could give rise to further diversification into gold in coming sessions as investors shy away from the dollar toward physically backed assets.
They said the precious metal has risen 25 per cent this year in London as the Dollar Index, which measures the greenback’s performance against the euro and five other currencies, dropped 6.4 per cent.