Gold prices hit their highest level in almost a year in New York on the weekend as oil prices rose, commodity prices remained firm and the US dollar and yen slid.
Both currencies weakened ahead of the weekend meetings of economic policy makers in Washington and traders went short or took profits in case of major policy announcements. So far none have eventuated.
Gold broke out of its recent narrow trading trade which had developed in the range $US675-$US680 despite the slide in the greenback.
June gold on Comex climbed $US10.20 to $US689.90, the highest closing price for the most-active current contract since May 17 last year.
The dollar fell to the lowest against the euro in more than two years on speculation. The dollar was also down against the British pound, the Japanese yen, the Australian dollar and the Canadian dollar.
Gold prices rose 1.6 per cent last week, the sixth straight weekly gain.
Silver was also strong, with the May price up 23.5 US cents to US$14.09 an ounce. It also had its sixth up week and the price has risen more than 8 per cent so far in 2007.
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Base metals had another strong week with copper again a stand out, up five per cent, despite a small dip of $US55 to $US7,745 a tonne on the LME on Friday.
The metal hit a seven-month high of $US7,955 a tonne during the week.
In New York May copper closed 3 USc higher at 353.20 USc/lb on Comex for a gain of 4.6 per cent over the week.
The metal has had six straight up weeks and in that time the price has jumped 25 per cent. New York copper hit a six month high of just over $US3.58/lb midweek.
In London three-month nickel hit the $50,000-a-tonne level for the first time ever during the week as stocks remain at less than a day’s worth of consumption. But it eased to close at $US 47,350 a tonne on Friday.
Lead also reached a record high of $US2,035 a tonne during the week On Friday lead prices finished slightly higher on the day and the week at $1,992.5 a tonne.
Besides the continuing strong demand from China, traders say there are some supply side uncertainties emerging.
Some workers at Freeport-McMoRan’s gold and copper mine in West Papua, Indonesia, are reported to be planning later this week over wages while in Argentina, Xstrata delayed some metal shipments from its Alumbrera mine after a flood delayed rail services.
