Commodities: Gold and silver surge on bets against U.S. securities
Commodities: Gold and silver surge on bets against U.S. securities By Pham-Duy Nguyen and Julie Tay Bloomberg News FRIDAY, MARCH 31, 2006
SEATTLE Gold and silver prices surged Thursday, hitting their highest level since the early 1980s, as investment funds bet that precious metals would lead U.S. stocks and bonds. Platinum and palladium also gained.
Gold has gained about 12 percent this year, and silver has soared roughly 30 percent, outpacing a 4.4 percent rise in the Standard & Poor's 500 index.
"Precious metals are booming," said Herwig Schmidt of Triland Metals in London. "If you have a huge amount of money and limited commodities, this is what happens."
Investment in the StreetTracks Gold fund linked to the price of gold has jumped by about a third this year to 11.2 million ounces. A similar fund for silver may trade next week, analysts said.
Gold futures for April delivery rose $13.40 to close at $586.70 an ounce on the Comex, a division of the New York Mercantile Exchange. A close at that price would be the highest since January 1981.
Investors are snapping up bullion on speculation the U.S. may allow the dollar to weaken. The dollar fell against the euro and yen on concern that investors may dump U.S. assets if the Bush administration pursues a policy supporting a weaker currency to help spur economic growth and employment.
"The potential for a weakening dollar is definitely a driver for gold," Evan Smith, a portfolio manager at U.S. Global Investors, said in Singapore. "We could see $700 an ounce in two years."
Silver for May delivery rose 54.5 cents to $11.660 an ounce. Prices are at the highest since September 1983.
Palladium futures for June surged $12.90 to $350.30 an ounce. Platinum futures for April rose $13.80 to $1,090 an ounce.
Crude oil was little changed, close to an eight-week high, amid declining U.S. gasoline inventories and as the United Nations Security Council asked Iran to curb its nuclear program.
"The weekly inventory numbers caught the market by surprise again," said Michael Fitzpatrick of Fimat USA.
Light sweet crude for May delivery increased 70 cents to $67.15 a barrel on the New York Mercantile Exchange.
Market Data 
Markets 
AI
