6 Feb 2009

Gold rises 1.5% in price

10:30 am on 6 February 2009

Gold has risen 1.5% higher in price after the Bank of England cut its key interest rate again.

At 2:07pm EST (1907 GMT) on Thursday, spot gold was at $US914.80 an ounce - up 1.5% from the last trade on Wednesday.

US gold futures for April delivery settled up $US12, or 1.3%, at $US914.20 an ounce on the COMEX New York Mercantile Exchange.

Investors fear the amount of government debt being poured into the banking sector will fuel inflation.

The Bank of England earlier cut its rates to 1% in an attempt to revive the economy in Britain. The cut was expected.

The ECB opted to leave its interest rates on hold at 2%.

Silver was at $US12.84 an ounce, up 2.6% from its previous close in New York on Wednesday.

Platinum was at $US977.50 an ounce, up 1.4%. Palladium was at $US199.50 an ounce, up 2.8% from Wednesday.