By Michael Bogan
Gold prices reached a fresh record on Friday as investors increasingly doubt a global economic recovery is at hand.
Gold for August delivery closed at $1,258.30 per Troy ounce on Friday, off from its intraday high of $1,263.70, but up from a record settlement of $1,248.70 the previous day.
James Turk, renowned gold expert and founder of Goldmoney.com, believes gold could reach between $1,500 and $1,800 per ounce some time during 2010 due to the crisis in the euro.
“Anyone throughout Europe who understands how the euro is being debased is seeking the safety of gold,” he said.
Gold priced in dollars has climbed the wall of worry since January, rising 12%, as investors fear the recovery in the United States will be dull, at best, and hope of a recovery in Europe is all but dashed.
Nervous investors are buying gold as a safe haven from perceived riskier assets such as stocks, many bonds, and real estate amid growing concerns of a double-dip recession, MF Global commodities analyst Tom Pawlicki said.
New highs attract price-sensitive buyers, who “come in and buy it now rather than waiting and paying even more later,” he said.
Gold demand typically spikes during India’s wedding season, prompting buyers to buy the yellow metal in a rising market to avoid the possibility of getting caught buying at much higher prices.
Gold’s lead in the metals market has raised all boats within the complex, including silver, palladium and platinum, which all have been buoyed by gold’s appeal. Mining companies Newmont Mining Corp. and Barrick Gold Corp. have also seen its shares rise on the New York Stock Exchange as a result of the rise in the gold price.
Silver and platinum prices reached $19.18 and $1,587 per Troy ounce on Friday, respectively, for the July contract. Palladium for September delivery closed at $491.40 per Troy ounce.
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