Gold hits new record of more than $1,436/oz

Gold hit a record high above $1,436 an ounce on Wednesday as violence in the Middle East and North Africa supported interest in the precious metal as a haven from risk, and as US oil prices jumped above $100 a barrel.

Spot gold was bid at $1,434.20 an ounce at 1418 GMT against $1,433.70 late in New York on Tuesday, having earlier peaked at an all-time high of $1,436.40. US gold futures for April delivery rose $3.60 to $1,434.80.

Gold is building on a six per cent rise in February, its biggest one-month climb since August. This came on the back of unrest that unseated leaders in Tunisia and Egypt before spreading to Libya, Bahrain, Yemen, Oman and elsewhere.

"(There is) a combination of reasons for (the rise in) gold, but primary at the moment are strong oil and weak equities - basically geopolitical," said Simon Weeks, head of precious metals at the Bank of Nova Scotia.

"I think we see $1,450, and that's probably enough," he added. "Any good news from the Middle East will see a pullback to $1,400."

Violence fuelled further gains in oil. Brent crude rose towards $116 a barrel on Wednesday after settling at a near 2-1/2 year high, while US crude edged above $100.

Rising oil prices are set to support gold, analysts said, if they look likely to curb global growth. "They could very well impact (growth in) Europe, the United States as well, and indeed China," said VM Group analyst Carl Firman.

"That will give rise to uncertainty, it will lower demand predictions for, for instance, copper, and where it knocks industrial metals and equities, gold will probably benefit."

Elsewhere silver rose to a peak of $34.87 an ounce, its strongest level since early 1980, before edging back to $34.81 an ounce against $34.66.

Holdings in the world's largest silver exchange-traded fund, the iShares Silver Trust, rose to 10,693.68 tonnes on March 1, their highest since Jan. 14.

The trust reported a slight recovery in its holdings last month after they posted their biggest ever one-month fall in January.

Meanwhile platinum was at $1,841 an ounce against $1,838.49, while palladium was at $817.97 versus $814.47.

Follow Emirates 24|7 on Google News.