Gold reaches $464 per troy ounce

The price of gold on US markets reached a 17-year high on Friday morning as December gold futures on the New York Mercantile Exchange’s COMEX index gained $2.40 to $461.70 per troy ounce in early trade after having gone as high as $464 per troy ounce in the opening few minutes of trade.

The increase in prices has been put to buying as a hedge against economic uncertainty and inflation in the face of rising gasoline prices, worries about the strength of the dollar on global currency markets, and the damage caused by Hurricane Katrina along the US Gulf Coast at the end of August. Most analysts are saying that they expect gold to rise to at least $475 per troy ounce in the short term, and that a rise to $500 per troy ounce in the coming months is not out of the question.

Citigroup has forecast an average price of at least $450 per troy ounce in 2006/2007. However, analysts at CPM Group say that while gold might go as high as $470 per troy ounce in the short term, that high a price is probably not sustainable in the long run.