Gold futures rose to the highest in more than a week as the European sovereign-debt crisis spurred demand for the precious metal as a haven.
Standard & Poor’s last week cut Italy’s credit-rating outlook to negative from stable, citing slowing economic growth and “diminished” prospects for a reduction of government debt. Fitch Ratings lowered Greece’s long-term debt ranking to four notches below investment grade. Today, gold priced in euros climbed to a record.
“We see gold as a currency more than we see it as a commodity,” said Dennis Gartman, an economist and the editor of the Suffolk, Virginia-based Gartman Letter.
Gold futures for June delivery rose $6.50, or 0.4 percent, to settle at $1,515.40 an ounce at 1:39 p.m. on the Comex in New York. Earlier, the price reached $1,519, the highest for a most-active contract since May 11. The metal has gained 29 percent in the past year, reaching a record $1,577.40 on May 2.
The spot price of gold climbed to an all-time high of 1,080.95 euros an ounce today.
The U.S. Treasury has said Congress must raise the $14.3 trillion debt ceiling by Aug. 2 to avoid a government default on loans.
Monetary policy will “remain accommodative for at least the next couple of months,” said Tom Pawlicki, an analyst at MF Global Holdings Ltd. in Chicago. “The inability of the dollar to maintain its safe-haven status is potentially supportive for metals.”
Silver futures for July delivery fell 18.3 cents, or 0.5 percent, to $34.904 an ounce on the Comex. The price has almost doubled in the past 12 months.
Palladium futures for June delivery declined $3.70, or 0.5 percent, to $731.80 an ounce on the New York Mercantile Exchange.
Platinum futures for July delivery dropped $13.50, or 0.8 percent, to $1,755.90 an ounce on the Nymex.