Gold turned higher yesterday as traders looked for a hedge amid disappointing economic news and as well as soaring oil prices. The precious metal's hedge value increased as the US dollar dropped heavily against major counterparts. Gold prices are now on the rally recording at this hour a high of $964.70 an ounce after opening today's session at $950.30 an ounce.

Crude oil also rallied and moved above the $100 a barrel mark again as traders suggest that the dollar downgrade against the euro makes oil more attractive for non-dollar denominated currencies. Concerns that OPEC will cut supply when they meet next week also have to blame for the rise in oil prices. This supported the increase in oil prices as gold is know to act as a hedge against inflation.

A raft of gloomy US economic data including the recent weak consumer confidence and higher home foreclosures increased the speculation that the US economy may be in a recession. What we see here is not due to oil market fundamentals but due to investors' reaction towards the current circumstances. Commodities are generally considered a safe haven and therefore investors are funding money into commodities and metals at the moment which are seen safer bet than equities and currencies I times of uncertainty.