* Persistent dollar weakness underpins market
* SPDR Gold holdings inch up near record high
By Miho Yoshikawa
TOKYO, Dec 3 (Reuters) - Gold hit record highs over $1,220 an
ounce on Thursday as the precious metal continued to attract
investors looking for an alternative to the U.S. dollar.
Gold has risen by more than 7 percent since it touched a low
of $1,136.80 last Friday on fears of a possible default on debt
in Dubai, which forced investors to sell the metal to raise cash
to cover losses.
Analysts say worries about Dubai's loan payment problems are
still lingering, although they have been pushed onto the
back-burner, with the dollar's persistent weakness coming to the
fore.
Shuji Sugata, a manager at Mitsubishi Corp Futures, said gold
continued to be lifted higher because investors believe the
greenback will stay weak.
"The persistent view that the dollar will remain weak stems
from moves to review dollar-based assets and the belief that
interest rates will be stuck at low levels, and these are factors
that remain unchanged," he said.
Spot gold <XAU=> rose as high as $1,224.65 per ounce by 0244
GMT, before drifting lower to $1,222.50, up 0.5 percent from New
York's notional close of $1,215.90.
U.S. gold futures for February delivery <GCG0> touched an
all-time high of $1,226.00.
The metal reached record highs in euro and sterling terms on
Wednesday, according to Reuters data, indicating independent gold
strength.
The yen and the dollar fell on Thursday after Bank of America
said it would repay $45 billion of taxpayer bailout funds,
boosting investor confidence and trimming safety bids in those
currencies. []
Investors were also taking heart from moves by central banks
to buy gold to diversify reserves.
India's purchase of about half the International Monetary
Fund's planned sales of 403.3 tonnes of gold has reinforced views
that gold has established itself as an investment asset as well
as an alternative currency. []
Researchers with China's ruling Communist Party have said
that the country should buy more gold to boost its holdings.
Strong investor interest in gold was also demonstrated in the
increase in holdings of the world's largest gold-backed
exchange-traded fund, SPDR Gold Trust <GLD>, which is nearing a
the record high of 1,134.03 tonnes hit on June 1. []
It stood at 1,131.214 tonnes as of Dec. 2.
The world's largest silver-backed exchange-traded fund, the
iShares Silver Trust <SLV>, said its silver holdings fell 3.49
tonnes, or 0.04 percent, from the previous business day to
9,401.30 tonnes as of Dec. 2. Its holdings hit a record 9,404.79
tonnes on Nov. 30. []
Precious metals prices at 0241 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1222.50 6.60 +0.54 38.90
Spot Silver 19.33 0.13 +0.68 70.76
Spot Platinum 1499.00 -1.50 -0.10 60.84
Spot Palladium 387.00 -0.50 -0.13 109.76
TOCOM Gold 3466.00 56.00 +1.64 34.71 71256
TOCOM Platinum 4245.00 70.00 +1.68 60.07 11453
TOCOM Silver 548.10 7.80 +1.44 71.66 366
TOCOM Palladium 1094.00 10.00 +0.92 98.91 164
Euro/Dollar 1.5080
Dollar/Yen 87.85
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
((miho.yoshikawa@thomsonreuters.com; +81-3 6441 1854; Reuters
Messaging: miho.yoshikawa.reuters.com@reuters.net))
((If you have a query or comment on this story, send an email to
news.feedback.asia@thomsonreuters.com))
((Multimedia versions of Reuters Top News are now available for:
* 3000 Xtra : visit
http://topnews.session.rservices.com
* BridgeStation : view story .134
* Reuters Plus : from your WebDSS screen
For more information on Top News, visit
http://topnews.reuters.com))
Reuters Terminal users can see related news and prices by
double clicking on the codes in brackets:
- All precious metals headlines []
- Precious metals market reports []
- Daily fixing headlines []
- Technical analysis []
- Indian gold reports []
- European gold prices <GOLD/EU1><GOLD/EU2><0#PREC>
- London interbank gold forward rates <GOFO> <0#GOFO=>
- London silver forwards <SIFO><SIFO=>
- Gold lease rates <LGLR><0#LGLR=>
- London Bullion Market Association <LBMA01>
- New York Comex gold <0#GC:> and silver <0#SI:>
- New York platinum <0#PL:> and palladium <0#PA:>
- Asian gold prices <GOLD/ASIA1><0#PREC>
- Australian precious metals prices <GOLD/ASIA2><0#AUPREC=>
- Shanghai Gold Exchange prices <SGE/MENU>
- Hong Kong gold exchange prices <HKGG>
- Hong Kong bullion prices <SHKG>
- Indian bullion prices <INBULL><0#PREC-IN>
- Japanese producer prices <JP/PROD1>
For Related News and other topics, double click on one of these
codes:
SPEED GUIDES
<COMMOD> <ENERGY>
<PRECIOUS/1> <PRECIOUS/2>
<REUTERS>
