"The persistently high price of oil, the weaker dollar and the resurfacing credit crisis are driving up the price of precious metals, making them safe investments," said Jim Steel, chief commodities analyst for HSBC.

"There's a number of indicators that show investor risk-averse behavior is rising," he said, "and that, particularly, is a funnel into the precious metals."

Steel predicts gold prices

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[US@GC.1  Loading...      ()   ] in particular will continue to rise until the Fed responds more aggressively to inflation, or until oil prices cap. But even though gold and oil often move simultaneously, he cautioned investors not to draw too much of an analogy between the two.

"Directionally they do move together, but it's not necessarily a lock-step relationship," he said.

Disclosures:

Disclosure information was not immediately available for Steel or his fund.

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