Gold forged yet another record high this week, as investors sought safety, but most commodity markets plunged on concern that euro zone and US economic woes could spark another fierce global recession. With most other commodities reeling, gold was the star performer once again, as investors sought the traditional safe-haven precious metal amid the worsening outlook. “Gold prices have continued to remain underpinned ... as investors continue to fret about sovereign and growth risks,” said CMC Markets analyst Michael Hewson. Gold rose in New York, heading for the fifth straight weekly gain, as investors sought a haven from financial-market turmoil spurred by budget woes in the US and Europe. The Standard & Poor's 500 Index was poised for the biggest weekly slump since November 2008. Thursday, gold jumped to a record $1,684.90 an ounce as global economic concerns and the sovereign-debt crisis in the US and Europe sent yields on two- year Treasuries to a record low. “It's a volatile period for gold,” Adam Klopfenstein, a senior strategist at MF Global Holdings Ltd. in Chicago, said in a telephone interview. “Gold is an inverse barometer for equities and the economy, but investors are buying gold on breaks because the debt crisis can't be resolved in one or two days.” Gold futures for December delivery gained $3.20, or 0.2 percent, to $1,662.20 at 11:24 a.m. on the Comex in New York. A close at that price would leave the most-active contract up 1.9 percent this week. Earlier, the metal fell as much as 0.9 percent. Gains may be limited as some investors sell the metal to cover losses in other markets, said Dennis Gartman, an economist and the editor of the Suffolk, Virginia-based Gartman Letter. He recommended that clients cut gold positions by half. “Given the circumstances prevailing in a world that shall put a premium high upon liquidity, we think it is wise to liquidate our gold holdings ahead of everyone else,” Gartman said in the report. “The highs seen yesterday shall not be taken out for quite some long while.” Silver futures for September delivery dropped 60.6 cents, or 1.5 percent, to $38.825 an ounce on the Comex. By late Friday on the London Bullion Market, gold jumped to $1,658.75 an ounce from $1,628.50 the previous week. Silver eased to $39.24 an ounce from $39.63. On the London Platinum and Palladium Market, platinum dropped to $1,709 an ounce from $1,779. Palladium decreased to $742 an ounce from $824. Early Friday in London, the precious metal edged down slightly from earlier highs after data showed US job growth accelerated more than expected in July. But a weaker dollar against a basket of currencies helped support the precious metal. A weak dollar makes gold cheaper for holders of other currencies. "Gold is waiting to see where equity markets settle. There may be some position covering in equities and potentially some position covering in gold as well," said Ole Hansen, analyst at Saxo Bank. "There is a perfect storm for gold prices given the uncertainty about the debt crisis in Europe and the US, with... the dollar easing," said Arne Lohmann Rasmussen, an analyst with Danske Bank.
