Gold rebounds on possible nuclear crisis in Japan

Gold advanced on Wednesday trading on nuclear crisis fears in Japan and ongoing Middle East and North Africa tensions which enhanced demand on the metal as a safe haven.

Spot gold is currently trading around $1400.68 an ounce after recording a high of $1401.79 and a low of $1393.00.

In Japan, the devastating 8.9 magnitude earthquake which killed nearly 10,000 people in addition to various damages in buildings and infrastructure, but the big problem now is soar in radiations emitting from nuclear plants which is threatening of a nuclear crisis.

However, Japanese stocks rebounded for the first time today from 28-month low, giving a lift to oil to rise to $98.33 a barrel from the day's opening at $96.99.

On the other hand, the geopolitical tensions in the MENA region are still continuing, especially in Libya where the battles are still ongoing between Qaddafi loyalties and protests amid not strong intervention by Western countries. Also, protests are spreading in Bahrain and other countries.

The US dollar advanced against a basket of major currencies, as depicted by the dollar index which rose to a high of 76.51 compared with the day's starting level at 76.34.

Another boost for gold came from the escalation in European debt woes after Moody's' Investor Service downgraded Portugal's credit rating to A3 with negative outlook.

The euro zone will release inflation data with expectations showing that CPI will linger at 2.4% in February, to remain above the ECB's 2% target.

Gold has been benefiting from the rise in inflation levels which prompted some Asian economies to raise interest rate.

Later in the day, the United States is scheduled to release inflation and housing data.

The previous session, gold shed $33.10 or 2.32% after closing at $1395.20, while gold price was setin London at $1400.50 per ounce declining from $1407.00 during the AM fixing.