Gold rose to its highest in more than seven weeks on Wednesday, closing in on record highs as escalating unrest in Libya and soaring crude oil prices fuelled fears of inflation and slower economic growth. Spot gold rose 0.7 percent to $1,408.80 an ounce by 3:19 pm EST (2019 GMT), after earlier hitting $1,416.30, its highest since January 4. Bullion hit its lifetime high of around $1,430 on December 7.
US gold futures for April delivery settled up $12.90 at $1,414.00 an ounce, with volume totalled about 30 percent lower than the 30-day average, in line with lower-than-usual recent turnover. Open interest, a gauge of market liquidity, climbed 3 percent to above 500,000 lots as of Tuesday for the first time since January 21. Gold has gained nearly 9 percent since an intraday low of $1,308 on January 28 on a combination of simmering geopolitical tensions, expectation of a low interest rate environment and renewed concern about a European sovereign debt crisis.
Holdings in the world's largest silver ETF, the iShares Silver Trust, fell to 10,342.89 tonnes on Tuesday from 10,519.05 tonnes the previous day. Silver rose 1.2 percent to $33.45 an ounce. The metal has risen strongly this month on worries about tightness in the market, but metals consultancy GFMS said on Wednesday there was no need for concern about supply. Platinum dropped 0.5 percent to $1,780.49 an ounce, while palladium lost 3.1 percent at $777.50.
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