* Dollar stays under pressure
* Platinum tracks gold up to 12-month high
* Barrick announces liquidation of hedge positions
(Updates prices, adds comment)
By Jan Harvey
LONDON, Sept 9 (Reuters) - Gold rose back above $1,000 per
ounce on Wednesday as the dollar extended losses against the
euro, and amid concern about the sustainability of this year's
rally in equities and some key commodities.
An announcement by the world's largest gold miner, Barrick
Gold <ABX.TO>, that it plans to eliminate its forward gold sales
also propped up prices, analysts said.
Spot gold <XAU=> was $1,000.20 an ounce at 1447 GMT compared
with $995.20 late in New York on Tuesday. U.S. gold futures for
December delivery <GCZ9> on the COMEX division of the New York
Mercantile Exchange rose $2.20 to $1,002.00.
Platinum <XPT=> also climbed to a 12-month high of $1,295 an
ounce in early trade, boosted by the surge in gold prices. It
was later at $1,284 an ounce against $1,283.
"There is strong investment interest at the moment, and the
media interest after gold broke through $1,000 an ounce is also
increasing interest on the speculative side," said Commerzbank
analyst Eugen Weinberg.
He said news of Barrick's dehedging activity was also
supporting gold prices.
Gold broke through the $1,000 mark for the first time since
February on Tuesday and rallied to an 18-month high, boosted by
technical buying momentum and a sharp slide in the dollar.
The precious metal touched a record $1,030.80 an ounce in
March 2008. Analysts say that if prices manage to consolidate
around $1,000 an ounce, rising risk aversion and dollar weakness
could push them back towards this high.
The dollar index <.DXY> fell 0.63 percent on Wednesday,
extending the previous session's sharp fall to near year lows,
supporting gold at higher levels. The euro rose to $1.46 against
the dollar amid a broad-based sell-off of the currency. []
Questions over the dollar's status as a global reserve
currency fuelled selling of the U.S. unit on Tuesday. A weaker
dollar tends to prompt buying of gold as an alternative asset.
"Clearly part of this is concern about further weakness in
the dollar," said Daniel Smith, an analyst at Standard
Chartered. "People are piling into gold in all sorts of
different ways, both consumers and investors."
CAUTION REIGNS
He said a more cautious tone to the wider markets, after a
rally in asset prices over the summer months, and expectations
China may move to diversify its foreign exchange holdings away
from the dollar were also lending support to the precious metal.
"Our view is that (gold) will keep pushing higher over the
next few weeks and towards the end of the year, and that it will
actually break through the previous high," he said.
Oil prices rose above $71 an ounce, extending Tuesday's 4.5
percent dollar-driven gains. Gold tends to track crude prices,
as it can be used as a hedge against oil-led inflation. []
Barrick Gold said it planned to eliminate its outstanding
fixed-price gold hedges and a proportion of its floating hedges.
[]
Miners have hedged by selling forward their unmined
production as a means to lock in prices. But as prices have
risen in recent years, they have tended to de-hedge, or cut back
their hedged positions, to take advantage of price gains.
Among other precious metals, silver <XAG=> was at $16.57 an
ounce against $16.41. Silver, which like copper or nickel is a
largely industrial metal as well as an investment product, came
under pressure from losses in the base metals early Wednesday.
Palladium <XPD=> was at $292.50 against $294, with prices
suffering from their proximity to the key $300 an ounce mark,
which has prompted some investors to take profits after the
metal's 1 percent rise in Tuesday.
(Editing by Sue Thomas)
