BLBG: Commodities Rise to Two-Year High on Central-Bank Debt-Buying Speculation
Commodities rose to the highest in almost two years on speculation central banks around the world will join the Bank of Japan in increasing purchases of government debt to boost economic recovery.
The Standard & Poor’s GSCI Index of 24 raw materials rose as much as 0.6 percent to 559.976, the highest level since Oct. 7, 2008, before paring gains. The UBS Bloomberg Constant Maturity Commodity Index climbed to 1,442.24, the highest since Aug. 29, 2008.
Gold futures rose to a record, topping at $1,351 an ounce, and silver futures extended a rally to a 30-year high. Wheat also gained and corn and soybeans were little changed after paring gains. Crude oil also was little changed after earlier gaining as much as 0.6 percent to the highest price since May 4.
“Gold will just keep running with the Japanese coming out with quantitative easing, and there is a lot of discussion about when the U.S. will come in,” Ashok Shah, chief investment officer at asset manager London & Capital said today by phone. “Gold and precious metals will continue to benefit because there is more quantitative easing down the line.”
Gold for immediate delivery rose $5.70, or 0.4 percent, to $1,346.35 an ounce at 11:23 a.m. in London. Futures for December delivery climbed $6.70, or 0.5 percent, to $1,347 an ounce. The most-active contract has gained 23 percent this year.
Silver for immediate delivery jumped as much as 1 percent to $23.0763 an ounce, the highest since Sept. 24, 1980. Platinum climbed to $1,707.50 an ounce, the most since May 17, and palladium rose to $593.25 an ounce, the highest since March 4, 2008.
Wheat futures for December delivery gained 3.25 cents, or 0.5 percent, to $6.6675 a bushel on the Chicago Board of Trade. Corn gained 0.25 cent to $4.9125. Soybeans for November delivery were unchanged at $10.7175 a bushel in Chicago.
To contact the reporter on this story: Tony C. Dreibus in London at tdreibus@bloomberg.net; Anna Stablum in London at astablum@bloomberg.net.
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net.
