Gold pokes through US $1,000 an ounce

[Arizona Coin Collector]

FROM:
http://www.financialpost.com/small_business/startup/story.html?id=1310542

Gold pokes through US $1,000 an ounce

Jonathan Ratner, Financial Post
Published: Friday, February 20, 2009

Gold broke through US $1,000 per ounce on Friday morning
as investors embraced bullion as a safe haven amid
continued concerns about the length and severity of
the global recession.

Gold retreated to US $995 later in the morning, but was
back in quadruple-digit territory by early afternoon.
It was selling for US $1003 an ounce at about 1:20 p.m.

Spot gold reached a high of US $1,030 last March, just
has Bear Stearns collapsed.

That high just over a year ago, marks the next level
of resistance, according to Colin Cieszynski, analyst
at CMC Markets Canada.

"This rally, combined with a retreat in other
commodities such as copper falling back toward
$1.40/lb support and US crude drifting back
under $39.00/bbl suggests that significant fear
over the global economy continues to overhang many
markets and that precious metals continue to act
as a haven for capital," he said in a report.

Record levels of bullion being held in exchange-trade
funds has contributed to gold's ascent, which has
seen the metal rise more than 20% in just over a month.

Experts say the opportunity cost of holding bullion
has diminished, with treasury yields at record lows
and demand fundamentals deteriorating in the broader
commodity and equity markets.

"Gold is acting on its own and only as a safe haven
for investors, ignoring all fundamentals," Afshin
Nabavi, a senior vice president at MKS Finance SA,
one of Switzerland's four bullion refiners, told
Bloomberg News.

Sustained investor interest in gold throughout 2008
helped push U. S. dollar demand for bullion to US
$102-billion, a 29% annual increase, according to
the World Gold Council. It said identifiable
investment demand for gold, which incorporates
exchange-traded funds (ETFs), bars and coins, rose
64% last year. This is equivalent to an additional
inflow of US$15-billion.

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