Nov 18, 2009

Gold futures higher after passing $1,150 level

Gold futures higher after passing $1,150 level

Gold rallied to yet another record high Wednesday, as weakness in the dollar weakness continued, along with the trend of borrowing the U.S. currency at low cost and using it to buy the metal and other commodities.

Gold for December delivery hit an intraday high of $1,153.40 an ounce on the Comex division of the New York Mercantile Exchange.

December gold finished at $1,141.20 an ounce, up $1.80, or less than 0.1%. and see the gold price today effect.

Gold traders typically look at the consumer-prices report, which tracks inflation at the retail level, for direction, in light of the impact this data have on currency markets and on gold itself. The metal's widely viewed as a hedge against inflation.

Officials at the Federal Reserve charged with setting monetary policy also keep a close eye on consumer prices.

Gold is underpinned by "trends that are already in place rather than from new sparks of buying interest," wrote Tom Pawlicki, analyst at MF Global, in a note to clients.

And Scotgold isn’t the only one. The key is higher profit margins which makes some mines worth producing. RioZim , Zimbabwe’s largest listed resource corporation, is planning to increase gold production to 80kg from the current 60kg a month at its Renco mine. A week ago Gold Fields announced they aim to produce 1m ounces from South America by 2015. All across the board we’re seeing mining companies motivated by the current surge in gold prices… well not quite all, but we’ll come to that later.