Gold prices topped $1,500 an ounce yesterday as investors looked for more stable assets because of worries about US government debt, European financial problems and inflation. Gold for June delivery settled at US$1,495.10 an ounce yesterday after hitting US$1,500.50 an ounce earlier in the session. May silver rose 95.7 cents to settle at US$43.913 an ounce. The gains came a day after Standard & Poor's Rating Service lowered its long-term outlook on US government debt over concerns about the massive budget deficit, which is projected to run a record $1.5 trillion this year.
The change means that S&P could lower its rating on US government debt in the future. If that were to happen, the US government would have to pay more to borrow money when it issues bonds. Investors also are worried about the impact that inflation may have on the global economy. China already has taken several steps to curb inflation, which could slow its economic growth. Europe, meanwhile, is dealing with financial issues in a number of countries, including Portugal. "I think it's going to be more in the forefront...of investors' minds here going forward," LaSalle Futures Group analyst Matt Zeman said. "The bottom line is the going looks good for precious metals going forward."
Most commodities also benefited from a weaker dollar. Since commodities are priced in dollars, a weaker dollar makes them more of a bargain for buyers using other currencies. In other metals trading, May copper rose 3.15 cents to settle at US$4.2295 a pound, July platinum fell US$11.50 to US$1,771.30 an ounce and June palladium dropped US$8 to $731.10 an ounce. In agriculture contracts, wheat prices rose after an US Agriculture Department report showed 36 percent of the winter wheat crop was in good-to-excellent condition for the week ending April 17. That compared with 69 per cent in the comparable week a year ago.
In May contracts, wheat rose 10.75 cents to settle at US$7.8575 a bushel, corn fell 2.75 cents to US$7.49 a bushel and soybeans lost 2.25 cents to US$13.42 a bushel. In energy trading, benchmark crude for June delivery gained 59 cents to settle at US$108.28 per barrel on the New York Mercantile Exchange. In Nymex trading for May contracts, heating oil gave up 2.43 cents to settle at US$3.1585 per gallon, gasoline futures fell 1.97 cents to US$3.2331 per gallon and natural gas rose 12.4 cents to settle at $4.262 per 1,000 cubic feet.