Gold Steadies Close to 6-Year Price Highs
Fri January 10, 2003 05:22 AM ET
LONDON (Reuters) - Safe-haven gold lurked near six-year price highs on Friday, supported by Iraq and North Korea tensions and a weak dollar.
Spot gold XAU= was quoted at $352.75/353.50 an ounce by 5:09 a.m. EST, lower than New York's last quoted $353.00/353.75 in mild proft-taking.
Bullion roared to $356.50 an ounce in the previous session -- its highest level since March, 1997 -- as funds piled into the metal on fears of a looming war with Iraq and dollar losses.
Some analysts saw further scope for price gains as funds were reluctant to go short of the metal ahead of the weekend.
"Gold is set to continue $345-357 for the moment as geopolitical tension acts to underpin the market, while the dollar and the funds will continue to be the main drivers," said James Moore, analyst at TheBullionDesk.com.
Investors have bought heavily into the safe-haven asset fearing a war in Iraq and the inflationary implications of a weak dollar EUR= and strong oil prices OILOIL .
"With the dollar weak again this morning another test of recent highs around $356/357 looks possible," said John Reade, metals analyst at UBS Warburg.
The euro kept a firm footing against the dollar as dealers awaited U.S. jobs data at 1330 GMT for clues on the health of the U.S. economy. The single currency was also helped by news early on Friday that Germany's public sector had reached a pay deal to avert a strike which could have damaged the economy.
U.S. non-farm payrolls are seen growing by a modest 22,000 in December. The unemployment rate is expected to remain steady at six percent.
Gold is up about 28 percent from this time last year, making it one of the best performing assets.
"Dips will continue to provide the market with an excellent buying opportunity and will gain additional support from the normal pre-weekend insurance buying. The upside looks restricted around $357 for the time being," said Standard Bank London in a report.
In other precious metals, spot silver XAG= was quoted at $4.83/85 an ounce, down from New York's Thursday close of $4.84/86.
Spot platinum XPT= was quoted at $615.00/620.00 an ounce, from $618.30/623.30 and palladium XPD= at $260.00/266.00 from $259.65/267.65.
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