* Gold rises to record above $1,400, silver at 30-yr peak
* Inflation worries after Fed's monetary easing lift gold
* Comments from World Bank's Zoellick in focus
* Coming up: G-20 meeting starts on Wednesday
(Recasts, updates with quotes, market activity, adds second
byline/dateline)
By Frank Tang and Amanda Cooper
NEW YORK/LONDON, Nov 8 (Reuters) - Gold powered to an
all-time high above $1,400 an ounce on Monday, despite a bounce
in the dollar, as investors sought an inflation hedge from the
Federal Reserve's massive bond-buying programme.
Gold has risen almost 6 percent since just before the
Federal Reserve detailed its plans last Wednesday to buy $600
billion worth of Treasuries to revive the economy.
Palladium rose 3 percent to break above $700 an ounce for
the first time since April 2001, and silver also gained 3
percent to its third consecutive 30-year high on the back of
speculative buying after gold's midday rally.
"As long as (investors) feel like there is no other
recourse except buying precious metals, gold is going to to
keep going up," said Miguel Perez-Santalla, vice president of
sales at Heraeus Precious Metals Management.
In early trade, gold looked set to drop following its
largest two-day gain in a year at the end of last week, but
remained near record highs even as the dollar rallied against
the euro on renewed budget problems in Ireland. []
Spot gold <XAU=> rose 0.8 percent to $1,406.10 an ounce at
12:31 p.m. EST (1731 GMT), after setting a record at $1,407.
U.S. December gold futures <GCZ0> climbed $7.30 an ounce at
$1,405.
Underlying support helped lift the metal after comments
from World Bank president Robert Zoellick in the Financial
Times calling for leading economies to consider readopting a
modified global gold standard to guide currency movements,
although most analysts deemed it unrealistic. []
"Gold could potentially play a small role in the overall
framework, but I don't think we are in a position to go back to
a gold standard," said commodities strategist Nic Brown of
Natixis.
"The world economy has moved too far from there and it
would need to be one that was built around a more inclusive
range of currencies," he said.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Q+A-Could world markets warm to a gold standard?
[]
Reuters Insider show on Zoellick's comments:
http://link.reuters.com/pyv93q
TIMELINE-Gold's history as a currency standard
[]
Factbox on how to invest in gold []
Factbox on gold milestones to record high []
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
UNREALISTIC
Zoellick called for a system that "is likely to need to
involve the dollar, the euro, the yen, the pound and (yuan)
that moves towards internationalization and then an open
capital account."
"I can imagine what he meant was asset inflation as
measured by the gold price should be an indicator that should
be considered by the central banks when they make their
interest-rate decisions," said LBBW analyst Thorsten Proettel.
The consensus among precious metals analysts was that the
gold market is also simply too small to absorb such demand.
"Unlike the World Bank, we do not believe that a form of
the gold standard will return. Very simply, there is not enough
gold supply in the world for the metal to perform in this
role," said Edel Tully, precious metals strategist at UBS.
Evidence of a cooling in investor interest in gold put the
price under pressure earlier in the session, with holdings of
gold in the SPRD Gold Trust <GLD> falling. []
Silver <XAG=> hit a fresh 30-year peak at $27.63 an ounce
and traded up 3.2 percent at $27.47 an ounce, and palladium
<XPD=> surged 3.4 percent to $710.72, up for a fourth day in a
row, while platinum <XPT=> eased 0.1 percent at $1,764.49 an
ounce, marking a second successive day of declines.
Prices at 1:24 p.m. EST (1824 GMT)
LAST NET PCT YTD
CHG CHG CHG
US gold <GCZ0> 1404.80 7.10 0.5% 28.2%
US silver <SIZ0> 27.435 0.687 2.6% 62.9%
US platinum <PLF1> 1771.20 2.30 0.1% 20.4%
US palladium <PAZ0> 707.50 22.10 3.2% 73.0%
Gold <XAU=> 1404.40 9.90 0.7% 28.1%
Silver <XAG=> 27.42 0.80 3.0% 62.8%
Platinum <XPT=> 1764.05 -1.45 -0.1% 20.4%
Palladium <XPD=> 704.83 22.30 3.3% 73.8%
Gold Fix <XAUFIX=> 1388.50 -1.50 -0.1% 25.8%
Silver Fix <XAGFIX=> 26.72 58.00 2.2% 57.3%
Platinum Fix <XPTFIX=> 1752.00 2.00 0.1% 19.5%
Palladium Fix <XPDFIX=> 694.00 8.00 1.2% 72.6%
(Additional reporting by Lewa Pardomuan in Singapore and
Siddesh Mayanker in Mumbai; Editing by Lisa Shumaker)
