Gold Run

Gold is trading at a seven-month high above USD 950 per ounce. The yellow metal has hit record high above Rs 15,000 per 10 gram in India. It is trading near record highs in currencies such as euro, pound, Canadian dollar and Swiss frank. In India, gold touched a high of Rs 11,500 per 10 gram on February 17, 2008 vs Rs 15,000 per 10 gram today. There are speculations that it may go up to a high of USD 965 per ounce and then, USD 1,165 per ounce. Gold has gained 30% over the last one-year. Gold prices are moving up due to a lot of newsflows on the currency front. Yen is at a five-week low compared to the dollar. Pound has also declined and is at a 2-week low, ahead of UK inflation data today. Asian currencies have also declined, Korean won is trading at 2-month lows. There are also speculations that exports and regional economies will contract further. Political scenario in Japan is further aiding the rise. Finance Minister of Japan has said that he will resign after budget bills are passed in Parliament. Other factors like an unstable global economic scenario, low interest rates, weak equity markets and depreciating rupee are also pushing the prices much higher. Factors - Unstable global economic scenario - Low interest rates - Weak equity markets - Central bank buying - Depreciating Rupee