Gold touches 7-mth high, silver sees 2-mth peak
LONDON (Reuters) - Gold jumped to a seven-month high on Friday, boosted by oil's spike above $60 a barrel and fresh buying prompted by the precious metal's break above a key resistance level, traders said.
Silver tracked gold higher, hitting a two-month of $13.93 an ounce, and platinum saw $1,203, the highest since November 22.
Gold XAU= was at $663.30/664.00 by 1600 GMT, down from an earlier $665.70, the highest since July 17, but up from $659.40/660.10 late in New York on Thursday, when it rose one percent.
"Since the beginning of this year the gold price has been strongly correlated to the oil price, a trend we expect to continue unless the dollar moves significantly against other currencies," Numis Securities said in a research note.
"The Lunar New Year (Chinese New Year) could be influencing gold price as jewelry manufacturers stock up for the celebrations."
Oil prices traded above the psychological $60 a barrel for the first time since January 3 on worries about supply shortages and rising tensions between the United States and Iran.
Gold is often seen as a hedge against oil-led inflation and often moves in the opposite direction to the dollar.
However, traders said the major influence on the market over this week has been technical levels.
"Oil has helped the cause, but it has been trading between $57 and $60 for a while now, it's already in the gold price," said Simon Weeks, director of bullion trading at ScotiaMocatta.
"Gold has been pushing higher this week ... Apart from fund interest, I've not seen much evidence of investment demand."
DEADLOCK
The International Monetary Fund could sell a limited amount of its gold reserves to increase its sources of income, IMF Managing Director Rodrigo Rato said. ID:nL09572905
But Rato said any sale should only be part of a wider solution to the global financial institution's revenues and should not disrupt the gold market.
"I don't think the IMF news is really impacting the gold price," said Tariq Salaria, analyst at Standard Chartered Bank.
Bullion investors are watching the Group of Seven finance ministers' meeting starting on Friday because it could move the dollar and so precious metals prices.
In other precious metals, platinum XPT= was up at $1,197/1,202 versus $1,187/1,192 in New York.
Traders said platinum was supported by news of deadlock in labor talks at Modikwa Platinum, jointly owned by African Rainbow Minerals (ARM) (ARIJ.J) and Anglo Platinum (AMSJ.J).
Some 3,000 workers at the mine have been on strike since January 26.
Silver XAG= gained to $13.83/13.88, against $13.75/13.80 late in New York on Thursday, and palladium XPD= slipped to $334/349 from $336/343.
(Additional reporting by Pratima Desai)
