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Gold Rises to Highest Since March as Euro Advances on ECB

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Gold Tops $1,700 as ECB’s Bond-Buying Plan Bolsters the Euro
December-delivery gold gained as much as 0.6 percent to $1,703.90 an ounce on the Comex in New York and was at $1,703.80. The price has risen 8.7 percent this year. Photographer: Ron D'Raine/Bloomberg

Sept. 6 (Bloomberg) -- Gold rose to the highest since March as European Central Bank President Mario Draghi said policy makers agreed to an unlimited bond-purchase program, 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.” A government report tomorrow may show U.S. payrolls grew at a slower pace last month. 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 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 0.7 percent to settle at $1,705.60 an ounce at 1:45 p.m. on the Comex in New York, after earlier jumping to $1,716.90, the highest for a most-active contract since March 12.

Prices will be at $1,840 by the end of 2012, Jeffrey Currie, the head of commodities research at Goldman Sachs Group Inc., said in a Bloomberg Television interview today.

Silver futures for December delivery advanced 1.1 percent to $32.674 an ounce in New York, after climbing to $33.04, the highest since April 3.

On the New York Mercantile Exchange, platinum futures for October delivery increased 0.7 percent to $1,586.40 an ounce, after touching $1,593.40, the highest since April 19. Palladium futures for December delivery rose 0.1 percent to $647.75 an ounce.

To contact the reporter on this story: Debarati Roy in New York at droy5@bloomberg.net

To contact the editor responsible for this story: Patrick McKiernan at pmckiernan@bloomberg.net

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