* Gold sets record high for second day, nears $1,050/oz
* SPDR Gold bullions holdings up third day in row
* Rogers cautious after record, expects long-term gains
(Recasts, updates prices, market activity, comments; Adds
second byline, dateline, previously LONDON)
By Frank Tang and Humeyra Pamuk
NEW YORK/LONDON, Oct 7 (Reuters) - Gold set record highs
for a second straight session on Wednesday as investors bought
the precious metal due to fears the dollar may weaken further,
bringing inflation.
Bullion has gained nearly 20 percent this year, helped by
dollar weakness and inflation worries after central banks and
governments across the globe poured billions of dollars into
the financial system to revive growth.
Spot gold <XAU=> hit a historic $1,048.20 an ounce, and was
last at $1,041.75 an ounce by 1:17 p.m. EDT (1717 GMT), versus
$1,040.85 quoted late in New York on Tuesday.
At the COMEX division of the New York Mercantile Exchange,
gold for December delivery <GCZ9> closed up $4.70 to $1,044.40
an ounce, after dealing in a session range between $1,037.80 to
$1,049.70, a new all-time record high.
Other precious metals also rose, with palladium <XPD=>
hitting $313.50 an ounce, its highest level since August 2008.
Platinum rose to a two-week high <XPT=> and silver <XAG=> to a
three-week high.
The dollar swung into positive territory, clipping gold's
gains [] along with technical resistance at $1,050 per
ounce. Still, analysts said momentum should remain in the
market's favor.
"When the market moves this much in the space of two days,
you have to expect it to pause for breath. But we don't see too
many signs of people looking to bail out and take profits
here," said Tom Kendall, metals analyst at Mitsubishi Corp in
London.
For a graphic on gold's rise versus the dollar's loss:
http://graphics.thomsonreuters.com/109/CMD_GLDPRF1009.gif
For graphic on gold's correlation with stocks, the dollar
and oil:
http://graphics.thomsonreuters.com/109/GLD_PRCCRR1009.gif
Daniel Sacks, Co-Portfolio Manager of the Investec Global
Gold Fund, said gold prices were set to test new highs as the
fourth quarter progresses.
"We believe it should continue to perform well against most
assets into the final quarter of 2009. Moreover, the price of
gold is still just over half of its prior peak in "real" terms,
even after the rally of the past eight years," he said in a
note to clients.
Metals consultancy GFMS has put the inflation-adjusted peak
for gold as high as $2,079 an ounce.
For a graphic on inflation adjusted gold price:
http://graphics.thomsonreuters.com/109/GLD_PRCINF1009.gif
WEAKER PHYSICAL DEMAND?
Gold's rally has boosted flows into exchange traded funds
(ETF). The world's largest gold-backed ETF, the SPDR Gold Trust
<GLD>, said its holdings stood at 1,100.514 tonnes as of Oct.
6, up 0.2 percent or 2.441 tonnes from the previous business
day for the third consecutive day of increase.<XAUEXT-NYS-TT>
But high prices should curb demand for physical gold, some
analysts said, which could make it hard to sustain the rally.
For a story on physical gold demand click on
[]
Renowned investor Jim Rogers, one of the biggest bulls on
this decade's commodities rally, is not so bullish on gold a
day after the precious metal set a record high, although he
does see further gains in the long term. []
Silver rose to $17.55 an ounce, its highest since Sept. 17,
and was last at $17.46 an ounce versus $17.32 an ounce last
quoted in New York on Tuesday.
Platinum climbed to $1,338 an ounce, its highest since
Sept. 23, and was last at $1,319 an ounce from $1,313.50 an
ounce.
Palladium <XPD=> was at $309.00 an ounce versus $305.50.
For a graphic on gold's price in dollars and euros, click
on:
http://graphics.thomsonreuters.com/109/GLD_PRCEUR1009.gif
Also see TAKE A LOOK-Gold hits record high on
[]
Prices at 1:17 p.m. EDT (1717 GMT)
Last Change Pct 2008 YTD
Chg Close % Chg
US gold <GCZ9> 1043.20 3.50 0.3 884.30 18.0
US silver <SIZ9> 17.475 0.180 1.0 11.295 54.7
US platinum <PLF0> 1325.90 2.40 0.2 941.50 40.8
US palladium <PAZ9> 313.45 3.15 1.0 188.70 66.1
Gold <XAU=> 1041.70 0.85 0.1 878.20 18.6
Silver <XAG=> 17.43 0.11 0.6 11.30 54.2
Platinum <XPT=> 1319.00 5.50 0.4 924.50 42.7
Palladium <XPD=> 309.00 3.50 1.1 184.50 67.5
Gold Fix <XAUFIX=> 1040.25 -6.75 -0.6 836.50 24.4
Silver Fix <XAGFIX=> 17.40 45.00 2.7 14.76 17.9
Platinum Fix <XPTFIX=> 1323.00 13.00 1.0 1529.00 -13.5
Palladium Fix <XPDFIX=> 312.00 0.00 0.0 365.00 -14.5
(Additional reporting by Christopher Kelly in New York and
Veronica Brown in London; Editing by David Gregorio)
