Silver breaches R60,000 mark,yellow metal climbs new high

Fridays slide in the dollar added fuel to a rally that has already taken gold to a series of record highs this year

The precious metals scaled a new peak on Friday. Silver continued its relentless record-breaking march and reached another milestone by breaching the magical Rs 60,000 per kg mark at the domestic bullion bourse on the back of hectic speculative trading and encouraging global cues.

Fridays slide in the dollar added fuel to a rally that has already taken gold to a series of record highs this year.

Silver ready (.999 fineness) zoomed by a massive Rs 1,045 per kg to close at Rs 60,125 from Thursdays closing level of Rs 59,080. Silver climbed two per cent to $40.33 an ounce,the highest level since January 1980. An ounce of gold bought as little as 36.48 ounces of silver in London today,the least since September 1983.

Standard gold (99.5 purity) spurted by Rs 110 per 10 grams to end at Rs 21,090 from Rs 20,980 previously. Pure gold (99.9 purity) rose by a similar margin to finish at Rs 21,190 per 10 grams as compared to Rs 21,080 yesterday.

Gold rose to a record US $ 1,474.50 an ounce in global markets as a weaker dollar and concerns about inflation and European debt boosted demand for the metal as an alternative investment. The gold gained $15.20,or 1 per cent,to $1,474.50 an ounce. Prices are up 3.1 per cent this week,the most since December.

In the overseas markets,the precious metals are scaling new peaks every day mainly on weakening dollar valuation amidst concerns over ongoing financial turmoil in euro zone countries and unending violence in West Asia. The European Central Bank yesterday lifted interest rates for the first time in almost three years to quell inflation even as Portugal sought a bailout. The dollar slid to the lowest level since December 2009 against six major currencies. Gold,which typically moves inversely to the greenback,has climbed on fighting in Libya and Japan’s earthquake and tsunami last month.

“It is mainly the weaker US dollar which is the driver today for gold prices,” said Commerzbank analyst Carsten Fritsch. “If the euro-dollar rate rises further,gold will follow suit.” The euro was buoyed by expectations for further euro zone rate rises,while the dollar came under pressure from a looming budget deadlock in the US. Gold has hit a series of peaks since January as violence across the Middle East and North Africa sparked safe-haven buying and pushed oil prices to multi-year highs.