Feb. 18 (Bloomberg) -- Silver extended a rally to a 30-year high, and gold climbed to a one-month peak as mounting unrest in the Middle East spurred demand for precious metals as a haven. Palladium jumped to the highest in almost 10 years.
Egypt approved a request from Iran to send two naval ships through the Suez Canal on their way to Syria, while Israel called the passage a “provocation.” Bahrain’s security forces attacked protesters for a second day. Gunfire broke out in Yemen’s capital, Sanaa, as pro-democracy demonstrations spread to Libya and Iran.
“If you see violence, you would buy precious metals for a safe haven,” said Peter Fertig, the owner of Quantitative Commodity Research Ltd. in Hainburg, Germany.
Silver futures for March delivery rose 72.6 cents, or 2.3 percent, to settle at $32.296 an ounce at 1:25 p.m. on the Comex in New York. Earlier, the price reached $32.87, the highest for a most-active contract since March 1980. This week, the metal gained 7.7 percent, the most since early December.
Gold futures for April delivery gained $3.50, or 0.3 percent, to $1,388.60 an ounce. Earlier, the price reached $1,392.60, the highest since Jan. 13. The metal climbed 2 percent this week.
Demand for gold bars and coins in the Middle East jumped 39 percent in the fourth quarter from a year earlier, World Gold Council figures yesterday showed.
Rising food and commodity prices have contributed to uprisings in the Middle East.
‘Talk of Inflation’
“There are still flare-ups and people getting hurt,” said Adam Klopfenstein, a senior market strategist at Lind-Waldock in Chicago. “There’s more talk of inflation, and no one wants to be short of precious metals heading into the weekend.”
Dennis Gartman, an economist and the editor of the Suffolk, Virginia-based Gartman Letter, prefers gold over silver,
“Silver’s fundamentals are clearly better than those of gold, but we will not accept the randomness and the violence that is the silver market,” Gartman said in his newsletter.
Silver traded as low as $26.30 on Jan. 28.
Palladium futures for March delivery climbed $14.70 or 1.7 percent, to $857.70 an ounce on the New York Mercantile Exchange. Earlier, the price reached $858.25, the highest since March 2001. The metal advanced 5.3 percent this week.
In the past year, silver has doubled, and palladium jumped 97 percent. Gold is up 24 percent, and platinum has gained 21 percent.
Platinum futures for April delivery fell 70 cents to $1,843.30 an ounce. The metal gained 1.6 percent this week.
Markets will be closed on Feb. 21 for the President’s Day holiday.
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