UPDATE 3-Gold eyes $700/OZ, aided by oil, political tensions
Fri Feb 23, 2007 11:44 AM GMT14
By Pratima Desai
LONDON, Feb 23 (Reuters) - Rising security concerns, higher oil prices and inflation worries may propel gold prices towards $700 an ounce over the coming days, analysts said on Friday.
Spot gold <XAU=> was higher at $676.70/$677.40 an ounce by 1120 GMT from $676.60/$677.30 late in New York on Thursday. Earlier this week the precious metal hit a nine-month high of $682.10 and since January 5 it has gained about 12 percent.
Traders expect initial resistance at $688.50, the highest since May 19 before the key psychological level of $700.
"It's not just oil, people are looking at geopolitical tensions as well," said Simon Weeks, director of bullion at ScotiaMocatta. "There are a lot of people buying into the commodity story."
Tensions between Iran and the United Nations and ongoing conflict in Iraq have helped boost gold, seen as a haven when security risks are rising.
The U.N.'s nuclear watchdog said on Thursday Iran had failed to meet a Wednesday deadline to suspend enrichment of uranium, exposing Tehran to possible new sanctions over concerns it seeks to produce an atomic bomb.
