Gold Breaks Through USD1,200/oz
Gold has hit another all-time high today, breaking through USD1,200/oz for the first time ever, as the dollar resumes it's downwards spiral.
Fund buying has helped drive the yellow metal to new highs, after briefly slumping to around USD1,140/oz late last week on profit-taking and a bought of the Dubai Jitters.
As fears over Dubai World defaults ease, and we enter a new month, the funds are back in. Will it be the ags turn this afternoon?
Gold Hits All-Time High As India Buys From IMF
Gold has hit an all-time high of USD 1,079.20/oz this afternoon after it was revealed that India's central bank had bought 200 MT of the stuff from the IMF in deal worth USD6.7 billion.
The poor old cash-strapped IMF is running a bit short of readies, having had every man and his greyhound banging on the door lately. They recently announced that they'd like to sell some of the family silver, well 400 MT of gold actually, from it's holdings to distribute to the needy.
India was the first to step forward with the cash, although China and Russia had been favourites. The move is seen supporting gold prices further, as it appears to confirm that central banks are comfortable entering the market to hold gold at over USD 1,000/oz.
It may also indicate that they feel that gold is a better asset than the US dollar reserves that they will be using to pay for it.
Oil, Gold Decline on Dollar Recovery
Crude oil and gold extended declines Tuesday as the dollar rebounded on speculation the Federal Reserve's efforts to combat a housing slump and a shortage of funds in credit markets may restore investor confidence.
The Fed lowered interest rates last week, agreed to accept a wider range of collateral on loans and extended credit to securities' firms for the first time.
Gold for immediate delivery dropped as much as 1.4 percent to $906.79 an ounce in Asia and traded at $917.90 an ounce in Singapore at 4:58 p.m. today. Gold, which has plunged 11 percent from its record $1,032.7 an ounce on March 17, is still up 10 percent for the year.
Crude oil for May delivery fell by as much as 1.8 percent to $100.02 a barrel on the New York Mercantile Exchange and traded at $100.56 at 5 p.m. Singapore time. Prices for the most active contract are still up 60 percent in the past year. U.S. crude oil prices are likely to fall toward $90 a barrel this spring as the country's slowing economic growth encourages traders to exit commodity markets, Goldman Sachs Group Inc. said in a report on March 20.
