Gold Advances for a Fourth Day in New York on the Outlook for Currencies

Gold rose for a fourth day in New York and climbed to a record in London as prospects for declining currency values may boost demand for precious metals. Silver extended gains to the highest price since 1980.

The euro fell against 15 counterparts ahead of this week’s disclosure of Ireland’s costs to bail out Anglo Irish Bank Corp. and speculation other European banks lack adequate capital. Central banks and the International Monetary Fund sold the least gold since an agreement began in 1999, according to data from the World Gold Council.

“Asian central banks are taking up the metal, and that’s certainly buoyed investor sentiment,” said James Moore, an analyst at TheBullionDesk.com in London. “There is a net devaluing of currencies.”

Gold futures for December delivery gained $2.80, or 0.2 percent, to $1,300.90 an ounce at 8:26 a.m. on the Comex in New York. Futures reached a record $1,301.60 on Sept. 24. Gold for immediate delivery in London climbed to an all-time high of $1,300.15.

Prices may advance to $1,406 an ounce in a year, the London Bullion Market Association said today, according to the average in a survey of those attending the London Bullion Market Association’s conference in Berlin this week.

Silver futures climbed as much as 24.6 cents, or 1.1 percent, to $21.645 an ounce on the Comex, the highest price since 1980. The December futures contract gained 19.1 cents, or 0.9 percent, at $21.59 an ounce most recently.

Some investors may prefer silver over gold because it is cheaper, Moore said.

Bank Sales

Central-bank sales of gold decreased to 94.5 metric tons in the year ended yesterday from 157 tons in the prior period, according to figures on the council’s website. European central banks have agreed to limit gold sales since 1999. India, Sri Lanka and Bangladesh bought bullion from the IMF in the past year.

Bullion is heading for a 10th consecutive annual advance, the longest winning streak since at least 1920, spurring central banks globally to add the metal to reserves. Combined central- bank holdings rose in every quarter since the second quarter of last year, data from the council show.

An ounce of gold bought as little as 60.07 ounces of silver today, the least since October last year, according to Bloomberg data. The lower the ratio, the more expensive silver is relative to gold.

Holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, decreased 0.91 ton on Sept. 24 as holdings in the iShares Silver Trust, the largest ETF for silver, climbed 30.4 tons to a record, according to figures from the funds’ websites.

Platinum for January delivery fell $1.90, or 0.1 percent, to $1,643.50 an ounce on the New York Mercantile Exchange. Palladium futures for December delivery dropped 0.1 percent to $559.90 an ounce. Both metals will become more important investments for pension funds, Shayne McGuire, director of global research at the Teachers Retirement System of Texas, said at the LBMA conference.

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net.

To contact the editor responsible for this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net.

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