Gold continues its seemingly unstoppable rise, reaching historical levels yet again in Thursday’s US session. Spot gold price spiked to a high of $1,538.12 per ounce in US trading, boosted by a broadly weakening greenback.
Despite US economic data released on Thursday which indicated a drop in jobless benefits claims, this did little to save the dollar, which is at a three year low against a basket of major currencies.
The Dollar index, which captures the greenback’s performance against a basket of major currencies, was down 0.1 percent at 73.030, having touched a three-year low of 72.871 on Thursday. It has dropped around 1.4 percent so far this week, close to the biggest weekly drop of 2.5 in the week of Jan. 10.
Investment Analyst Ong Yi Ling at Phillip Futures in Singapore commented that “If the dollar continues to weaken, then it’s only likely to boost gold as well as silver as the inverse relationship between the two assets persists. I would say that for gold I am still looking for it to hit $1,600 this year.” He added that “In the long term, I think, if we see silver prices at such a high level, then it could hurt the industrial demand.”
Based on technical analysis, a bullish target at $1,549 per ounce is predicted for spot gold, according to Reuters market analyst, Wan Tao.
Silver rallied to a record $49.77 an ounce on Monday but quieted down since Friday’s Asian session, to around $48.10. Year to date, silver prices have risen almost 60 percent, much higher than gold’s 8 percent gain.