SYDNEY: Gold was up half a percent on Friday, after a brief spike to a fresh 2010 high, on signs investors continue to plough money into bullion markets to hedge against economic turmoil in Europe.
Gold buying was particularly heavy among Japanese commodities' investors following a holiday on Thursday, dealers said. A debt crisis that threatens Greece and could expand to Spain, Portugal and potentially more of Europe has restored gold's role as a safe haven, allowing it to rise through the latter half of April despite gains for the dollar.
"The Japanese were good buyers this morning after coming back from holidays," a gold commodities fund with an Australian bank said. "Funds seriously feel like there is more default and sovereign issues to come so they all want exposure to the topside," the manager said.
The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said holdings hit a new record of 1,159.002 tonnes as of April 29, up 6.089 tonnes from the previous business day. Spot gold was at $1,172.75 an ounce at 0313 GMT versus $1,166.10 an ounce at New York's notional close, after reaching the highest this year earlier in the session.
Gold, which started 2010 at around $1,096 an ounce and generally traded either side of $1,100 an ounce, has managed to hold above that level for the whole of April, heading for a 5 per cent gain for the month. Rating agency Standard and Poor's slashed Greek debt to junk status and downgraded debt from Portugal and Spain this week, raising fears that contagion from Greece's fiscal crisis would spread. Ratings agency Moody's said a multi-notch credit downgrade for Greece is likely.
US gold futures for June delivery on the COMEX division of the NYMEX were up $4.90 an ounce at $1,173.70. Gold's advance came despite US stocks chalking up their best day in nearly two months on Thursday as investors welcomed a string of robust earnings reports, Platinum group metal prices climbed on worries that South Africa producers will be forced to curb production to conserve electricity.
A senior official from South Africa's power utility Eskom said he is confident it will be able to meet this year's power demand but supply could be tight from 2011-2012 latinum gained $10 to $1,739 an ounce Palladium rose $5.50 to $555 an ounce. Silver was up 8 cents to $18.51 an ounce.
(Metal Last Change Pct chg YTD pct chg Turnover): Spot Gold 1172.60 6.50 +0.56 7.02; Spot Silver 18.50 0.07 +0.38 9.92; Spot Platinum 1740.00 11.00 +0.64 18.61; Spot Palladium 555.00 5.50 +1.00 36.87; TOCOM Gold 3558.00 55.00 +1.57 9.17 47091; TOCOM Platinum 5261.00 82.00 +1.58 19.98 19515; TOCOM Silver 56.60 1.60 +2.91 9.48 672; TOCOM Palladium 1676.00 27.00 +1.64 43.86 1374; Euro/Dollar 1.3234 Dollar/Yen 94.05; TOCOM prices in yen per gram, except TOCOM silver which is priced in yen per 10 grams. Spot prices in $ per ounce.
