London: Gold hit a one-month high yesterday as the dollar came under pressure from easing fears over potential US rate hikes, and as talk of a bailout for debt-ridden Greece underpinned the euro.
Investors have in recent weeks poured money into gold as a hedge against currency volatility, while the metal's steady rebound since falling below $1,100 has also ignited technical buying and boosted sentiment.
Spot gold hit an intraday high of $1,130.65 an ounce and was quoted at $1,123.65 yesterday, up from $1,117.50 at New York's notional close on Friday. US gold futures also struck a one-month high, silver gained more than 1 per cent, while platinum and palladium tracked bullion higher.
"There's a bit of risk coming back into the market, we shook off the change in US discount rates and the nervousness disappeared fairly quickly after that. $1,100 is a level being looked at, if we can hold it there could be further gains to be made as news from Greece unfolds," said Ole Hanson, analyst at Saxo Bank.
Surprise
The dollar weakened yesterday as investors reassessed the chances of an earlier-than-expected interest rate hike by the Federal Reserve.
Currency markets took the Fed's surprise decision to raise its discount rate last week as a signal the US central bank was coming closer to raising its benchmark rate.
However, a benign US inflation reading on Friday caused markets reassess that view.
