Gold Climbs Most Since April as Dollar Weakens, Crude Rallies

16 July 2009  Bloomberg.com

Gold jumped the most in more than two months as the dollar slumped and oil rallied, boosting demand for alternative assets to hedge against inflation. Silver also rose.

A 17 percent jump in gasoline drove the U.S. consumer price index up 0.7 percent in June, the fastest pace in a year, Labor Department figures showed today. Crude-oil futures, used by some investors as an inflation-outlook guide, soared. The U.S. Dollar Index, a six-currency gauge of the greenback’s value, dropped as much as 1.1 percent. Gold tends to rise when the dollar weakens.

“Gold is steadily ticking higher, and recent dollar weakness and the gain in oil prices are favoring the move,” Pradeep Unni, a Richcomm Global Services analyst in Dubai, said today in a report. “Gold has enough potential to rise higher,” Unni said.

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