LONDON—Spot gold rose in Europe and is expected to continue moving higher this week as physical buying escalates in Asia and optimism about a solution to the euro zone's debt crisis makes investors more willing to buy riskier assets.
Mid morning, the spot price of gold was up 0.4% at $1,687.10 a troy ounce. Other precious metals were also higher, with spot silver up 0.4% at $32.30 an ounce, spot platinum 1.7% higher at $1,571.20 an ounce and spot palladium having risen 2.3% to $635.25 per ounce.
European equities and other commodity markets, including crude oil futures and base metals, were all mostly in positive territory as well.
Gold, traditionally viewed by the markets as a haven investment, has increasingly moved in line with riskier assets in recent sessions. Analysts therefore expect gold to continue pushing higher as confidence improves, particularly after European leaders at the weekend vowed to take swift and decisive action on tackling the European debt crisis.
The physical market, where demand remains firm ahead of India's Diwali festival—one of the most significant gold-buying periods for the country—should also help drive prices higher, they said.
"We remain bullish...and believe that investors should be adding gold at current levels," said Morgan Stanley in a report.
Write to Rhiannon Hoyle at rhiannon.hoyle@dowjones.com
