Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (33547)	5/12/2003 5:45:55 AM
From: elmatador	Respond to of 74559

Gold prices shine again By Kevin Morrison Published: May 9 2003 20:24 \| Last Updated: May 9 2003 20:24 Gold was a beneficiary of the decline in the US dollar this week, rising $8 per troy ounce over the week to its highest level in two months and attracting more speculative investment. Gold price movements are closely correlated with currency markets as investors increasingly turn to gold as an alternative to the dollar. "I think we are seeing a diversification out of the dollar into other assets, of which gold is one, rather than a straight swap from dollars to gold," said Kevin Crisp, precious metals analyst, at Dresdner Kleinwort Wasserstein. Gold hit $349 a troy ounce on Friday - its highest level since March 11 - and has now risen almost 8 per cent from its low of the year a month ago. Mr Crisp said the gold price is starting to increase in other currencies too, after weeks of remaining static. Japanese gold futures jumped to an eight-week high Friday. For gold producing countries such as South Africa and Australia, gold prices have moved above recent lows, which will ease pressure on margins for gold miners. Mr Crisp said this week's rise has pushed gold above its 100-day moving average of $345 per oz, indicating that speculative buying may have reappeared. "Success breeds success. As soon as gold goes higher it attracts more investors," Mr Crisp said. With so many dollar bears around, gold could be ready to test the $350 mark, a level it has been able to stay above in only two months - January 6 to March 11 this year - of the past six years. Mr Crisp said the gold rally to $388.50 in early February was driven partly by war fears, but now currencies are having more of an effect on gold. "Currencies constantly devalue because of inflation, whereas gold still holds its purchasing power," said Graham Birch, head fund manager at Merrill Lynch Gold & General fund.