Rising dollar pressures gold - Friday 18th January 2008

A strengthening in the dollar led to gold prices easing back earlier today (January 18th).

The yellow metal was at $873.30 per ounce in New York trading this morning, compared with $878.17 an ounce towards the end of yesterday's trading, Thomson Financial reports.

Speculation over potential interest rate cuts on the part of the European Central Bank led to the bounce in the dollar, which has been weak against other currencies in the recent past.

"Further rate cuts by the Fed and the Bank of England's monetary policy committee are already priced in, but the ECB sounds less hawkish lately," analysts at Dresdner Kleinwort commented.

Gold has hit a number of record highs in the last few weeks, reaching $914 an ounce earlier this week.

Consultancy GFMS yesterday predicted that gold will reach the $1,000 per ounce mark this year, fuelled by increasing interest from investors.
Goldbug, 18 Jan '08

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