Gold, Silver Up on Mideast Tension
Thursday, 12 November 1998
(AP)
GOLD AND silver futures rose sharply Thursday on the New York
Mercantile Exchange as tensions between the United States and Iraq
mounted, causing investors to move investments into safer commodities.
On other markets, platinum and palladium also rose sharply, while coffee
futures continued to give back gains made as Hurricane Mitch battered
Central America.
Gold and silver jumped as additional U.N. relief workers departed Iraq
ahead of a possible military strike led by U.S. forces.
The United States and Britain have been threatening a military response
since Iraq announced Oct. 31 that it was halting the activities of the U.N.
Special Commission, known as UNSCOM, which is responsible for
eliminating Iraq's weapons of mass destruction.
Precious metals have traditionally acted as a hedge against falling
currencies during times of political, military or economic crisis. The U.S.
dollar, also seen as a relatively safe investment, rose strongly during the
day against other foreign currencies as military forces converged in the
Persian Gulf.
The gains for precious metals also came as buying picked up for
jewelry-making during the holiday season.
Gold for December delivery rose $3.80, or 1.2 percent, to $297.50 an
ounce; December silver rose 13.3 cents to $5.133 an ounce.
Platinum and palladium futures jumped after Russia's Interfax news agency
quoted an unidentified Ministry of Finance official as saying that country
may export no more than 20 metric tons of platinum and 100 tons of
palladium in 1999. The figures are slightly less than what has been
exported this year, a time during which automobile and electronics makers
have been scrambling to find available supplies.
Russia is the world's largest palladium exporter and is the second-largest
platinum exporter behind South Africa.
January platinum jumped $11 to $350.80 an ounce; December palladium
rose $4.75 to $278.25 an ounce.
Coffee futures continued their sharp declines on the New York Board of
Trade amid signs U.S. inventories will grow significantly in coming weeks
despite possible damage to the Central American arabica crop.
Colombia, the world's largest grower of arabica beans favored by U.S.
coffee drinkers, confirmed earlier this week it is likely to harvest a
significantly larger crop, while Brazil reported its pace of shipping reached
a four-year high in October, after a port workers strike ended.
Brazil, the world's No. 1 producer, harvested its largest crop in 11 years,
at about 35.2 million bags weighing 132 pounds each.
Coffee futures prices have returned nearly to levels before Hurricane Mitch
struck Central America, in part on speculation damage to those crops will
be far less than originally envisioned.
December arabica coffee fell 2.25 cents to $1.13 a pound. |
