RTRS: Gold hits 8-week high as oil climbs, dollar slips
LONDON - Gold rose more than 1 percent to an eight-week high of $940.25 an ounce on Wednesday, supported by a slide in the dollar versus the euro and a jump in oil prices to a six-month peak.
Prices were higher for much of Wednesday but jumped after breaking through key technical resistance, identified by analysts who study charts of past price movements, just below $934 an ounce. Further resistance is seen at $951.
Spot gold was bid at $938.45 an ounce at 1416 GMT, against $924.65 an ounce late in New York on Tuesday. U.S. gold futures for June delivery on the COMEX division of the New York Mercantile Exchange rose $12.30 to $939.00 an ounce.
“It is definitely one of the driving forces that the U.S. dollar is weakening, particularly against the euro,” said Peter Fertig, an analyst at Quantitative Commodity Research.
“Also, firmer oil prices are usually regarded as a signal that inflation might pick up. However, that risk currently is rather small.”
Strength in crude oil prices can also boost interest in commodities as an asset class. Oil jumped above $61 a barrel on Wednesday to a new six-month high on bullish inventory data and a spate of refinery accidents in the United States.
A slide in the dollar also helped gold. The U.S. currency hit a four-month low versus the euro on Wednesday after U.S. Treasury Secretary Tim Geithner said the financial system was ”starting to heal.”
