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Gold Hits Historic High on Surging Oil, Euro

Gold roared to an historic high above $955 an ounce on Wednesday after oil hit a record above $101 a barrel and the U.S. dollar tumbled against other currencies, lifting the metal's safe-haven appeal.

Gold Bars
AP
Gold Bars

Silver hit a 27-year high, palladium jumped to its best level in more than six years but platinum hovered below last week's record high.

Spot gold rose as high as $955.70 an ounce, driven by buying from investors and speculators, particularly in Japan. It was up from $946.60/947.40 late in New York on Tuesday and has gained more than 14 percent this year.

"Gold seems to be reacting to the general weakness in the dollar and of course the fact that oil prices are now trading above $100 a barrel consistently," said Darren Heathcote of Investec Australia in Sydney.

"Let's just say $970 is not inconceivable. As I guess $1,000 is not inconceivable. There doesn't seem to be much reason to sell gold," he said.

Weak economic data and comments from the Federal Reserve's No. 2 provided more proof that U.S. interest rates will continue to head lower, pushing the dollar below the psychologically crucial $1.50 level against the euro and spurring a broad-based commodities rally.

Silver jumped as high as $19.02 an ounce, its best level in 27 years, as a weaker dollar spurred buying. The metal was last quoted at $18.65/18.70 late in New York on Tuesday.

Spot platinum rose to $2,145/2,152 an ounce from $2,130/2,140 an ounce but off last week's record high of $2,192 an ounce.

Palladium rose as high as $540 an ounce, its best level in more than six years, up from $523/528 late in New York.