(Adds byline, quotes, mining shares)
By Lewa Pardomuan
SINGAPORE, Jan 14 (Reuters) - Gold hit another record high
on Monday and may touch the psychological level of $900 an
ounce soon as turmoil in financial markets and expectations of
aggressive U.S. rate cuts raised its safe-haven appeal.
Other precious metals mostly firmed, with platinum hovering
not far from last week's record highs. Gold mining stocks
rallied after U.S. gold futures hit record highs.
"There is blue sky ahead of us and there is room for gold
to go higher. We are in an uncharted territory, really," said
Darren Heathcote of Investec Australia in Sydney.
"We have a weaker dollar and that's encouraged people to
buy gold. We are going to be drawn towards $900 and test it and
not break through today yet," he said.
Spot gold <XAU=> hit an all-time high of $898.30 an ounce
before dipping to $897.00/897.80 an ounce, higher than
$895.70/896.50 hit late in New York on Friday.
COMEX gold futures touched $900.60 an ounce, surpassing
Friday's record high of $900.10. The most active February
contract <GCG8> was later quoted at $899.1, still up $1.4 an
ounce.
Investors have poured money into gold after the dollar
dropped on expectations the Federal Reserve would cut interest
rates by an aggressive half-percentage point at its Jan. 29-30
policy meeting to rescue the U.S. economy.
Fears of further subprime mortgage-related write-downs in
the U.S. financial sector and inflation fears driven by
record-high crude oil <CLc1> also attracted buying from
investors and speculators.
The euro inched up to $1.4805 <EUR=>, back near a five-week
peak of $1.4825 hit earlier in January.The dollar eased to
108.87 yen <JPY=>.
Dealers said gold was on track to test $900 but may have
trouble staying above that level as high prices were likely to
turn away jewellery makers and other physical buyers.
"I still think it's not sustainable. The physical sector is
not too enthusiastic to purchase here," said William Kwan, a
dealer at Phillip Futures in Singapore.
"On the speculative side, the small speculators have
already gotten out of their shorts," he added.
The Japanese gold futures market was closed for a holiday.
The key gold futures contract for December 2008 delivery
<0#JAU:> on the Tokyo Commodity Exchange (TOCOM) ended 51 yen
per gram lower at 3,168 yen on Friday.
Gold miners rose, with Newcrest Mining <NCM.AX> up 2.1
percent, LihirGold <LGL.AX> up 1 percent and Sino Gold Ltd
<SGX.AX> <1862.HK> rising 7.7 percent.
Platinum <XPT=> was at $1,562/1,567 an ounce, steady from
$1,562/1,566 an ounce in New York -- within sight of Friday's
record high of $1,564 an ounce.
Silver <XAG=> rose to $16.25/16.30 an ounce from
$16.19/16.24 late in New York. It rallied to its best level in
27 years at $16.29 last week.
Palladium <XPD=> rose to $376/370 an ounce from $375/379.
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Precious metals prices at 0158 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 896.80 1.00 +0.11 7.70
Spot Silver 16.25 0.04 +0.25 10.02
Spot Platinum 1562.00 0.00 +0.00 2.76
Spot Palladium 376.00 1.00 +0.27 2.17
Euro/Dollar 1.4809
Dollar/Yen 108.78
(Editing by Ben Tan)
