Tuesday, September 8, 2009

Gold breaks through $1 000 for the 3rd time in history - here's why

SHOOT: I remember reading recently that economists see gold hitting $2000 or $2200.

How, why? Because of dollar weakness, and right now the Rand is at its strongest levels since May 2008. The world is becoming increasingly weary of the petrodollar, and the currency which many of the world's currencies are traded against. Thus gold is seem as a hedge against losing further value, something one anticipates China, who holds trillions in US treasury bills, will move increasingly towards as the dollar deteriorates in sync with the US economy.
clipped from www.fin24.com

Johannesburg - Gold rushed through the key $1 000 an ounce mark early on Tuesday morning on a weaker dollar and inflation concerns.

This is the third time the precious yellow metal has ever breached the $1,000 an ounce mark and analysts said it is likely to see further gains.

The first time gold touched this key psychological level was in March 2008 and it last traded at more than $1 000 an ounce in late February this year.

Gold was bid at $996.65 an ounce at the London open on Tuesday and by 09:09 was trading 1.05% or $109.45 higher at $1 004.45 from a close of $994 an ounce.

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