July 22 (Bloomberg) -- Gold approached a record high on demand for an investment haven amid persistent debt concerns in the U.S. and Europe.
Greece faces a “restricted default,” Fitch Ratings said, after European leaders agreed yesterday to an additional bailout. U.S. lawmakers are still debating on raising the $14.3 trillion debt ceiling before the government runs out of cash on Aug. 2. Gold reached a record $1,610.70 an ounce on July 19.
“There’s a clamor for gold as the printing presses go off around the world,” Adam Klopfenstein, a strategist at Lind- Waldock, a broker in Chicago, said in a telephone interview. “The U.S. and Europe have structural problems, and there’s a camp of investors that are willing to buy until these problems are fixed.”
Gold futures for August delivery rose $17.20, or 1.1 percent, to $1,604.20 at 11:10 a.m. on the Comex in New York. Earlier, the metal reached $1,607.70. The price headed for the third straight weekly gain.
On July 20, total open interest in Comex futures climbed to a six-month high of 546,601 contracts.
Europe’s leaders yesterday announced 159 billion euros ($229 billion) of new aid for Greece, including a pledge by banks to exchange and buy back the nation’s debt, which may result in a short-term default.
President Barack Obama and House Speaker John Boehner are pressing for a broad accord to boost the debt limit while cutting spending by trillions of dollars and overhauling the tax code.
“Real contagion risks remain, as do currency risks,” GoldCore Ltd., a broker in Dublin, said in an e-mail. “The dollar and the euro remain vulnerable to further debasement and depreciation.”
Silver futures for September delivery rose $1.048, or 2.7 percent, to $39.995 an ounce on the Comex, heading for the third straight weekly gain.
Palladium futures for September delivery fell $1.35, or 0.2 percent, to $807.65 an ounce on the New York Mercantile Exchange. Platinum futures for October delivery rose $10.20, or 0.6 percent, to $1,798 an ounce. The metals headed for the fourth straight weekly gain.
--Editors: Patrick McKiernan, Steve Stroth
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