Gold shoots past US$1000/Oz

Gold futures and spot gold both rose above the US$1000 milestone, touching a six-month peak in the process, spurred by persistent weakness in the dollar, concerns about the sustainability of the global economic recovery and worries about inflation. Gold for December delivery, the most active contract, hit an intraday high of US$1009.40 an ounce in electronic trading on Globex. This was the first time a front-month Gold futures contract reached the four-figure mark since late February. The record for gold futures is US$1033.90 an ounce, reached March 17, 2008. Gold has rallied every year since 2000. The Dollar Index, a six-currency gauge of the dollar’s value, declined this week. The US dollar fell to a new yearly low versus the euro and tumbled versus other major rivals, undercut as investors continued to show rising appetite for risk. It was unclear how sustainable the rise above US$1000 an ounce will turn out to be, wrote analysts at Commerzbank in a note to clients. "The last two times when it occurred - in February this year and in March last year - the price increase was only temporary and ended in a massive correction below the US$900-an-ounce level," they said. "Seasonal trends seem to make this less likely though, as physical gold demand typically picks up around autumn and winter time."