(Updates prices)
By Lewa Pardomuan
SINGAPORE, Jan 14 (Reuters) - Gold hit a record high above
$900 an ounce on Monday as turmoil in financial markets and
expectations of aggressive U.S. rate cuts helped raise the
metal the metal's safe-haven appeal.
Platinum hit a lifetime high while silver touched a 27-year
peak, buoyed by gold's rise.
Spot gold <XAU=> hit an all-time high of $904.60 an ounce,
higher than $895.70/896.50 in New York on Friday.
COMEX gold futures touched $905.70 an ounce, surpassing
Friday's record high of $900.10. The most active February
contract <GCG8> was later quoted at $896.1, down $1.6 an ounce.
Japanese gold futures <O#JAU:> were closed for a holiday.
"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.," he said.
Investors have bought gold as a safe-haven asset 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 jumped to $1.4875 <EUR=> on electronic trading
platform EBS, the highest since late November and within a cent
of a record high of $1.4968 hit that month.
Gold was on track to break above $900 but some dealers said
the metal 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.
Gold's 14-day relative strength indicator (RSI) rose to
85.95 on Friday as gold hit a record, and hovered above 80 on
Monday. The market views an RSI of 30 or less as oversold and
70 or more as overbought.
In Singapore, dealers noted selling from holders who cashed
in on gold's gains as well as limited purchases from jewellers
at lower levels.
Gold mining stocks rallied after U.S. gold futures hit
record highs, with Newcrest Mining <NCM.AX> up 2.05 percent,
Lihir Gold <LGL.AX> up 1 percent and Sino Gold Ltd <SGX.AX>
<1862.HK> rising 6.62 percent.
Platinum <XPT=> hit record high of $1,565/1,570 an ounce,
up from $1,562/1,566 an ounce in New York.
Silver <XAG=> rallied to its highest in 27 years at
$16.39/16.44 an ounce from $16.19/16.24 late in New York.
Palladium <XPD=> rose to $376/380 an ounce from $375/379.
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Precious metals prices at 0716 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 903.50 7.70 +0.86 8.50
Spot Silver 16.39 0.18 +1.11 10.97
Spot Platinum 1565.00 3.00 +0.19 2.96
Spot Palladium 376.00 1.00 +0.27 2.17
Euro/Dollar 1.4876
Dollar/Yen 108.24
(Editing by Ben Tan)
