23 Jan 2009

Gold rising in price

10:38 am on 23 January 2009

Despite a stronger US dollar, gold prices rose by 1% on Thursday amid strong demand for coins and bars.

At 2.12pm EST (1912 GMT) on Thursday, spot gold was at $US860.10 an ounce - up 0.7% from the last trade of $US854.05 on Wednesday.

Gold for February delivery settled up $US8.70, or 1%, at $US858.80 an ounce on the COMEX division of the New York Mercantile Exchange.

MKS finance head of trading Afshin Nabavi said there has been a strong demand by investors for physical gold since the beginning of the week.

Royal Bank of Scotland this week reported huge losses and Bank of America was granted more government funding.

Scotiabank Group vice president Patricia Mohr said there was exceptional retail interest in gold coins and bars recently.

The SPDR Gold Trust in New York said its holdings rose to a record 805.96 tonnes on Wednesday.

In Europe, Zurich Cantonal Bank said holdings have risen by 9%, or 283,000 ounces, since the end of November.