Gold traded near a nine-month high in Asia as escalating tension over Iran’s nuclear research programme spurred demand from investors seeking a haven.
Representatives of the US, the UK, Russia, China, France and Germany met in London for talks and will discuss by telephone on 1 March details of a new United Nations’ sanctions resolution, State Department spokesman Sean McCormack said on Monday in Washington.
Gold has risen 4.3% since 21 February, the UN’s deadline for Iran to stop enriching uranium. “There is some caution in the market over the possibility of tensions over Iran’s nuclear programme,” said David Moore, commodities strategist at Commonwealth Bank of Australia in Sydney.
Gold for immediate delivery traded up as much as 95 cents (Rs41.80), or 0.15%, to $687.50 (Rs30,250) an ounce and traded at $683.76 at 1:32pm Mumbai time.
Gold, which has gained 12% since 5 January, touched $688.56 on 23 February, its highest in nine months.
“The threat of a renewed round of anti-Iran sanctions and the potential for a disruption in crude-oil flow from the world’s fourth-largest producer is keeping safe-haven buyers on the alert,” Jon Nadler, an investment-products analyst at Montreal-based Kitco Minerals & Metals Co., said in a note to clients.
“We are bullish on gold and I would say that on the upside, gold could rise to $720 in the next month and a half,” Sunil Ramrakhiani, head, commodities, IL&FS Investmart Commodities Ltd in Mumbai, said.
“We expect gold to trade between $670 and $720 in the short term,” he said.
Meanwhile, Iran rejected demands by western countries to suspend uranium enrichment, Agence France-Presse reported on Monday, citing a government official. Calls for Iran to suspend nuclear activities are an illegitimate demand by the West, government spokesman Gholam Hossein Elham was cited as saying.
In Japan, gold for delivery in December 2007 fell 19 yen, or 0.7%, to 2,672 yen a gram ($690 an ounce) at close on the Tokyo Commodity Exchange.
Gold futures for April delivery rose as much as 90 cents, or 0.1%, to $689.70 an ounce and traded at $687.50 at 1:34pm Mumbai time in after-hours trading on the Comex division of the New York Mercantile Exchange.
In India, the price of the metal for April delivery fell Rs41, or 0.4%, to Rs9,796 per 10gm at 1:28pm Mumbai time on the Multi-Commodity Exchange.
A futures contract is an obligation to buy or sell a commodity at a set price for delivery by a specific date.