Gold traded near a seven-month high in London, edging nearer $1,000 an ounce, as a global recession, volatile currencies and slumping stocks prompt investors to buy the metal as a store of value. Silver and platinum also climbed. Bullion reached $974.32 today, the highest since July 22, as stocks in Europe followed Asian equity markets lower. Investors have increased gold holdings in exchange-traded funds to records as countries around the world cut interest rates and boost spending to try to revive their economies. “Given the continued bearish economic news reports, we expect investor diversification to continue,” said James Moore, an analyst at TheBullionDesk.com. The metal will “eventually push on towards $1,000,” he said. Gold for immediate delivery added $2, or 0.2 percent, to $972.25 an ounce by 9:37 a.m. in London. The metal reached a record $1,032.70 in March. April futures gained $5.50, or 0.6 percent, to $973 in electronic trading on the Comex division of the New York Mercantile Exchange. Gold in the SPDR Gold Trust, the largest exchange-traded fund backed by bullion, climbed to a record 1,000.8 metric tons yesterday, placing it just behind the 1,040 tons held by Switzerland, the world’s sixth-largest stockpile. President Barack Obama yesterday signed into law a $787 billion U.S. stimulus bill that increases the government’s commitments to $9.7 trillion. The country’s benchmark interest rate, along with Japan, is near zero, while the Bank of England this month cut rates to a record low of 1 percent. Gold priced in euros and pounds reached an intraday record today. Among other metals for immediate delivery in London, silver gained 1.1 percent to $14.285 an ounce. Platinum rose $21.25, or 2 percent, to $1,111.75 an ounce, and palladium was 0.7 percent higher at $221 an ounce.

Source