Gold set to glitter even as dollar continues to remain weak
16 Nov 2009
It was the day of yellow metal as it set a record high above $1,130 an ounce on Monday. Investors have been carefully preparing for the metal to rise toward the psychologically important $1,200 mark with dollar expected to remain weak for the time.
Investors bought into the metal as a hedge against currencies even as the dollar drifted southward in Asia and the euro inched up on speculation continued over China's yuan currency policy.
On Sunday, the US and China clashed over exchange rates at a meeting of Asia Pacific leaders, a move that belied expectations that China would allow the scope of the yuan to rise in coordination with US president Barack Obama's first trip to Beijing.
Gold has hit record levels on seven days of the past 10 sessions rising 6 per cent in the process. The last record was $1,122.85 on Thursday.
US gold futures for December delivery were at $1,129.20 an ounce, which was up 1.1 per cent on Friday's settlement. The contract had risen to new record high of$1,130.60.
According to analysts the current uptick appears to be sustainable as the market has not felt the 'real euphoria' of a daily price rise of more than 3 per cent.
Gold prices are expected to remain volatile over the coming days as substantial amounts of open positions remain in US December gold futures call options with a strike price of $1,200 due to expire next week.