Gold Rises to Highest Since March as Euro Advances on ECB
Gold futures rose to the highest since March as European Central Bank President Mario Draghi said policy makers agreed to an unlimited bond-purchase program to help stabilize the region, boosting demand for the metal as a store of value.
Draghi said the ECB will have a “fully effective backstop to avoid destructive scenarios with potentially severe challenges for price stability in the euro area.” U.S. jobless claims declined last week and companies added more workers than forecast in August, reports showed today before monthly payrolls data tomorrow. In August, gold jumped 4.5 percent, the most since January, on speculation that the Federal Reserve and the ECB will increase steps to bolster their economies.
“Expectations of inflation rising after Draghi’s statements are supporting gold,” Adam Klopfenstein, a market strategist at Archer Financial Services Inc. in Chicago, said in a telephone interview. “Tomorrow’s jobs data will be crucial as that will be one of the leading indicators about the health of the economy.”
Gold futures for December delivery gained 0.6 percent to $1,703.50 an ounce at 9:59 a.m. on the Comex in New York, after earlier jumping to $1,716.90, the highest for a most-active contract since March 12.
Gold will be at $1,840 by the end of 2012, Jeffrey Currie, head of commodities research at Goldman Sachs Group Inc., said in a Bloomberg Television interview today.
Silver futures for December delivery advanced 0.9 percent to $32.62 an ounce in New York, after climbing to $33.04, the highest since April 3.
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