Gold glimmers to fresh highs


Gold is seen as more likely to hold value despite economic and political jitters

Staff and wires

HONG KONG, China -- Gold bullion prices rallied to their highest levels in years as investors put their money on shimmering ingots despite concerns over the global economy and the on-going standoff in the Middle East.

On Friday, gold futures muscled to a fresh-17 month high in New York as capital moved toward the asset seen likely to hold value amid economic and political adversity.

Gold for June delivery at COMEX rose to $312.50 an ounce at midday Friday, its highest since July 18, 2000, and closed up $3.50 at S$312.10.

Spot bullion closed at $311.10/60, a price last seen in February 2000, compared with $307.70/308.45 on Thursday, and $306.60 at London's last fix.

Dealers said players are turning to gold as insurance against a weakening U.S. currency, higher oil prices, and volatile global markets.

Those worries added to concerns a regional standoff in the Middle East could intensify.

The rise in prices pushed gold stocks higher in Asia despite a slump in tech shares.

In Australia, Newcrest Mining led the gainers in the mining sector, soaring nearly four percent to A$6.46.

In China, the central People's Bank of China (PBOC) raised domestic buy and sell prices of 99.99 percent pure gold at its regular fixing on Monday.

The PBOC also raised gold prices on Saturday for the third time last week.

China set its buying price for 99.99 percent pure gold on Monday at 81.27 yuan per gram, up from 80.87 yuan per gram on Saturday, and the selling price at 82.89 yuan per gram, up from 82.48 yuan per gram.

But spot gold was seen drifting sideways in Asian trade ahead of London's open.

Traders said investors are awaiting confirmation that Friday's big leap was not purely an options-related squeeze.