MW: Gold tops $960 for first time in two months as dollar weakens
Gold futures rose Friday for a fourth-straight session, briefly topping the $960-an-ounce mark for the first time in nearly two months as the U.S. dollar weakened against its major rivals on concerns over the U.S. credit rating.
Gold for June delivery rose to as high as $963.10 an ounce in early morning trading, topping $960 for the first time since March 19. It was last up $6.30, or 0.7%, to $957.50 on the Comex division of the New York Mercantile Exchange. The metal is set to end the week up nearly 3%.
The greenback fell Friday to the lowest level this year against the euro as worries increased that the U.S. could lose its triple-A credit rating.
Standard & Poor's Ratings Service Thursday warned Britain that it may lose its triple-A rating, triggering a drop in U.K. bonds and sparking global fears about sovereign credit ratings. In the U.S., 10-year Treasury bonds fell below a crucial level. See related story about U.S. rating.
A weaker greenback makes dollar-denominated commodities such as oil and gold less expensive to holders of other currencies. Those countries tend to bid up oil prices. Some investors also buy gold as a hedge against a weaker dollar and inflation.
"The gold price is predominantly driven by the dollar weakness at the moment," said analysts led by Barbara Lambrecht at CommerzBank. "As long as the dollar remains on the back foot, gold should continue to rise."
In exchange-traded funds, holdings in the Gold SPDR Trust , the biggest gold ETF, stood at 1,105.62 metric tons Thursday, unchanged for a seventh-straight session, according to latest data from the fund.
In other metals trading Friday, July copper rose 6.4 cents, or 3.1%, to $2.115 a pound.
July silver gained 28 cents, or 1.9%, to $14.725 an ounce. The June palladium contract rose 65 cents, or 0.3%, to $236.10 an ounce, while July platinum gained $2.40, or 0.2%, to $1,157.10 an ounce.
Among metals-sector equities, shares of Barrick Gold Corp. (ABX 37.99, +1.10, +2.98%) rose 2.3% to $37.77 and South Africa's Gold Fields Ltd.gained 0.3% to $13.27, while Newmont Mining Corp. rose 0.3% to $46.79.
The Amex Gold Bugs Index , which tracks the share prices of major gold companies, added 1.9% to 380.62.
The iShares Gold Trust ETF gained 0.3% to $94.17, while the iShares Silver Trust ETF rose 0.6% to $14.43.
