Gold Climbs on the Futures Markets

Traders on the U.S. futures market bid up the price of gold to a record high early Thursday on continued concern about the slowing economies of both Europe and the United States.

Gold for December delivery, the most actively traded contract on the CME Comex, rose $22.60 to a new high of $1,816.40 per ounce, while silver for September delivery gained 23 cents to $40.59.

U.S. claims for unemployment benefits last week rose more than expected, the Labor Department said Thursday. Analysts were looking for the number of claims for jobless benefits to climb to 400,000 from 395,000 in the previous week, but the actual figure came in at 408,000.

Meanwhile, economists warned that western economies are flirting with another recession. Morgan Stanley slashed its global growth forecast for 2011 and 2012, saying the U.S. and the euro zone were "dangerously close to a recession," and criticized policymakers in Washington and Europe for not acting more decisively to contain the sovereign debt crisis, Reuters reported.

The bank cut its global gross domestic product growth forecast to 3.9 percent from 4.2 percent for 2011, and to 3.8 percent from 4.5 percent for 2012.

"Our revised forecasts show the US and the euro area hovering dangerously close to a recession -- defined as two consecutive quarters of contraction -- over the next 6-12 months," Joachim Fels, who co-heads Morgan Stanley's global economics team, said in a research note dated Wednesday.

Consumer prices rose faster than expected in July as gasoline rebounded sharply, but a moderation in underlying price pressures backed the Federal Reserve's view of a low inflation environment.

The Labor Department said its Consumer Price Index increased 0.5 percent, the largest gain since March, after falling 0.2 percent in June. Economists polled by Reuters had expected a 0.2 percent rise last month.

Gasoline, which rose 4.7 percent after falling 6.8 percent the prior month, accounted for about half of the rise in CPI last month.

Core CPI -- excluding food and energy -- rose 0.2 percent after rising 0.3 percent in June. Last month's gain was in line with economists' expectations.

The Federal Reserve last week promised to keep interest rates near zero at least until mid-2013 to boost growth and said the outlook for inflation over the medium-term was subdued.

Data on Wednesday showed wholesale prices, excluding food and energy, rose at their quickest pace in six months in July, with the year-over-year increase the largest since June 2009.