Gold Nears $1200/oz; Silver Prices Decline Slightly – May 6, 2010

by Bullion Prices Staff on May 6, 2010

U.S. gold prices jumped on Thursday, nearing an all-time high and closing toward $1,200 an ounce. The yellow metal’s rise for a second straight day was again spurred by safe-haven buying with concerns over the euro zone debt crisis forefront.

Gold "hit a fresh five-month high and came within an eyelash of hitting they key technical level of $1,200.00 an ounce Thursday," wrote Jim Wyckoff of Kitco News. "Safe-haven buying interest and strong investment demand for physical gold have combined with bullish technicals to drive gold prices north."

In New York precious metals prices, June gold soared $22.30, or 1.9%, to end at $1,197.30 an ounce. It ranged from $1,173.00 to $1,198.00.

"Gold is yet another currency … but it does not have the debt issue. It’s not just a Greek problem, not just a European problem, but a global problem," Axel Merk, president of California-based Merk Mutual Funds, which has $550 million fund assets, said on Reuters. "Gold is one way that investors can try to diversify in a world where there are no risk-free assets anymore."

In white metals, July silver fell slightly to end at $17.515 an ounce, retreating 1.9 cents, or 0.1%. July platinum ended up $16.90, or 1.0%, to $1,666.50 an ounce. June palladium finished to $514.10 an ounce, rising $5.55, or 1.1%.

"We like owning gold and expect further upside as sovereign risks intensify and real [interest] rates remain anchored," analysts at J.P. Morgan said in a report Wednesday that was cited on MarketWatch. "We believe that the market is underestimating secular risks … Growing sovereign risk is lifting our appetite for gold."

In London bullion prices, the afternoon gold fix was $1,185.25 an ounce, rising $20.25, or 1.7%. Silver was $17.690 an ounce, gaining 6 cents, or 0.3%. Platinum settled at $1,662.00 an ounce, gaining $26.00 or 1.6%. Palladium was $507.00 an ounce, advancing $14.00, or 2.8%.

In a coin item of the day, 2010 high gold prices have been a helpful boon for U.S. Mint bullion coins. For more, reach the article 2010 Gold Buffalo Coins Hit 70,000.

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