(Updates prices, adds closing in Tokyo)
By Lewa Pardomuan
SINGAPORE, Feb 29 (Reuters) - Gold powered to a new high
near $980 an ounce on Friday after crude oil set an all-time
high of above $103 a barrel, igniting inflation worries and
another round of buying from investors and speculators.
Palladium jumped to its highest level in more than six
years and silver hit a 27-year peak. Platinum rebounded from
its lows but given the absence of new developments in South
Africa's supply problems, gains are likely to be capped.
Gold <XAU=> jumped as high as $975.90 an ounce, up from
$968.90/969.70 late in New York on Thursday. Gold has gained
more than 16 percent this year, and the next upside target
pegged by dealers is $1,000.
Record high oil and expectations of more interest rate cuts
in the United States add to inflation pressures, elevating
gold's appeal as a hedge against rising prices, while volatile
stock markets have encouraged investors to shift some of their
money into gold and other precious metals.
"The target is $1,000. I personally hope it will be $1,000
within a month," said Yukuji Sonoda, precious metals analyst at
Daiichi Commodities in Tokyo, adding that gold was likely be
driven by movements in oil in coming weeks.
Crude oil <CLc1> rallied to another record above $103 a barrel
as Ecuador shut a key export pipeline and a fire hit a major
European natural gas plant.
While oil is at a record price in inflation-adjusted as
well as nominal terms, gold has lagged. According to analysts
at GFMS gold's inflation-adjusted record is $2,079 an ounce.
"Most of the funds are buying inflation hedges such as
gold, silver and oil. It's still a bull market, where hedge
funds and banks buy precious metals," said William Kwan, a
dealer at Phillip Futures in Singapore.
"I think inflation is really getting out of hand. I am
looking at $955 for support and resistance at $985," said Kwan,
who pegged upside target for silver at $20.
Silver <XAG=> rose as high as $19.92 an ounce, its highest
in 27 years, up from $19.74/19.79 an ounce in New York.
The dollar tumbled to a three-year low versus the yen and
held near record troughs against other currencies after Federal
Reserve chief Ben Bernanke warned some small U.S. banks could
fail, suggesting that interest rates may fall more.
[]
Spot platinum <XPT=> rose to $2,161/2,168 an ounce from
$2,135/2,140 an ounce late in New York to track a rebound in
Tokyo futures. Platinum has dropped more than 1 percent since
last week's record high of $2,192 an ounce,
Automakers, who had bought the metal on fears of further
price hikes and mining disruptions in South Africa, were on the
sidelines waiting for a correction, said Sonoda of Daiichi
Commodities.
"Car makers are waiting for the price to decrease to
$2,000," he said.
Platinum, used in jewellery and auto catalysts, has jumped
more than 40 percent this year after mines in South Africa,
accounting for 80 percent of world output, were shut for five
days at the height of last month's power crisis.
The most active February 2009 contract <0#JPL:> on the
Tokyo Commodity Exchange hit a low of 6,839 yen per gram before
funds bought on dips and pushed up the contract to a high of
7,069 yen. It ended at 7,051 yen, up 34 yen from Thursday's
close.
"This is driven by funds, and there's no buying from
general public. What we've seen is purely a technical rebound,"
said a dealer in Tokyo.
Palladium <XPD=> hit a high of $582 an ounce, its strongest
in more than six years, up from $560.00/564.00 late in New
York.
Precious metals prices at 0844 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 972.75 3.85 +0.40 16.82
Spot Silver 19.82 0.08 +0.41 34.19
Spot Platinum 2161.00 26.00 +1.22 42.17
Spot Palladium 582.00 22.00 +3.93 58.15
TOCOM Gold 3291.00 -6.00 -0.18 7.55
91070
TOCOM Platinum 7051.00 34.00 +0.48 32.07
40945
TOCOM Silver 673.50 12.00 +1.81 24.49
2257
TOCOM Palladium 2011.00 80.00 +4.14 48.85
24559
Euro/Dollar 1.5210
Dollar/Yen 104.29
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Michael Urquhart)
