Gold returns to trade near record high
Investor's demand for safety intensified Monday, driving the precious metal to gain as Libya unrest drove commodities higher, especially oil. Inflation hedging techniques also helped boost demand for gold, taking the metal to trade near record high. Silver trades near a 31-year high.
Bullion for immediate delivery rose from the opening levels of $1,434.00 an ounce, to currently trade at $1,438.45 an ounce, while setting a high of $1,438.74 an ounce and a low of $1,432.55 an ounce. Futures gained 0.66% or $9.400 to trade at $1,438.000 an ounce.
Oil prices continue on rising due to Libya's unrest, where speculation increased that the supply from the top African exporter would be interrupted, driving demand for safe haven higher.
Inflation threats across the world also drove the metal higher, where recently; China and Indonesia, raised rates this year, in effort to limit the inflation bubble and cool growth. The US Commodity Futures Trading Commission said that hedge-fund managers increased their net-long positions in NY gold futures during the week ending March 1.
Inflation in Europe doesn't look so promising either, where ECB's rate decision last week hinted for the possibility of raising rates in April's meeting as inflation continue to tamper with recovery. UK's consumer prices currently stand at double the amount desired by the BoE, while the same index in the 17-nation economy stands at 2.3 percent.
The S&P GSCI index closed Friday's trading at 719.62, higher by 7.94 percent, while the RJ/CRB commodity index closed at 362.88, after gaining 2.32 percent.
Cocoa futures ended Friday's trading at 3,657.000 a metric ton, after dropping 2.04 percent. Brent Crude futures rose 1.15% as it added $1.330 to trade at $117.300 a barrel.
This week's BoE rate decision will influence gold trading, where if the bank hike rates, hedging against inflation will surely send the metal prices higher. On the other hand, Analysts predict that the Fed will keep its rates near record low of 0.0%-0.25%, which would send the dollar to depreciate further, accordingly, providing another supporter for gold to ascend due to the inverse relationship between commodities and the dollar as they are a dollar weighted investment tools.
The dollar fell against the euro to the lowest level in four-months, sending the US dollar index, which tracks the performance of the currency against six-majors, to retreat and trade at 76.330, compared with the opening levels of 76.434.
Technically speaking, the metal's trend remains to the upside as far as the support at $1,390.00 an ounce remains intact, while the 100-day MA support level is set at 1,374.00 an ounce.
Gold's trading remains above the support at 1,410.00 an ounce, where if breached it will pave the way for the pair to test the support at %1,400.00 an ounce, but the general trend remain to the upside with initial targets set at 1,440.00 an ounce and probably return to trade near the achieved record around $1,460.00 an ounce.
Major Metal Fixing
As for metal Fixes (Mar 4); Gold fixed at AM Fix was set at $1,418.00 an ounce while the PM fixing (MAR 4) was set at $1,427.00 an ounce; meanwhile silver fixing was set at $34.43000 an ounce and Platinum AM Fixing (Mar 4) was set at $1,831.00 an ounce, and at 1,828.00 an ounce during the PM fixing (Mar 4); finally ending with Palladium AM fixing set at $811.00 at (Mar 4) AM fixing, while the PM fixing (Mar 4) was set at $811.00 an ounce.
Silver for immediate delivery traded at $36.40 an ounce compared with the opening levels of $35.55 an ounce, while setting a high of $36.53 an ounce and a low of $35.55 an ounce. Silver future contracts traded higher by 3.25% or 1.148 to trade at 36.475 an ounce
Platinum for immediate delivery traded higher by $0.50, at $1,836.00 an ounce, while Palladium gained by $6.0 to trade at $811.50 an ounce.