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HONG KONG: Gold prices hit a fresh record high of
$891.40 an ounce in Asian trade Wednesday, buoyed by higher oil
prices, a weak dollar and geopolitical tensions, before easing off
its peak, traders said.
The yellow metal closed markedly
up at $886.20 to $886.70 an ounce, from $863.20 to $863.70 on
Tuesday. It opened at $887.10 to $887.60.
Gold is seen as a defense against
inflation, which in many countries is driven by runaway crude
prices, which rose to $96.69 a barrel in late afternoon Asian trade
as traders bet on further crude inventory falls in the United
States, the world’s biggest energy consumer.
The precious metal is also seen
as a safe haven amid global unrest, which on Tuesday was being
fuelled by tensions between Iran and the United States. A weak
dollar makes gold cheaper for buyers using stronger currencies.
“Oil prices and a weak US
dollar remain the reason for record gold prices,” said Gary Yue,
gold dealer at Delta Asia Financial Group.
“There are also psychological
factors. There are investors who are challenging the high levels,
trying to test the $900 mark. Other metals like silver and white
gold are not following.
“I think when it reaches
$889.00, there’s a chance that the prices will adjust and need to
stabilize now,” he said.
Gold’s new historic record beat
the previous all-time pinnacle of $868.89 set last Thursday amid
unrest in Pakistan, a faltering dollar and as oil struck an historic
peak above $100 a barrel.
Before the recent surge, the
yellow metal had hit a then record of $850 per ounce in 1980 amid
inflationary fears that were sparked by runaway oil prices amid the
Iranian revolution.
--AFP
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