Gold gains on inflation fears

Precious metals prices were higher Tuesday on concerns that new US government plans to bail out banks and rescue the economy from recession will send inflation soaring.

The new plan was announced by US Treasury Secretary Timothy Geithner, who said that the plan would take time and money and would entail a certain amount of risk.

Gold was seen by investors as a safe place to guard money against inflation and general risk, sending April gold up $21.50 to $914.20 per troy ounce.

Silver and platinum also saw substantial gains as March silver added 30 cents to $13.13 per troy ounce in New York trade and April platinum was $39 higher to $1,039 per troy ounce.

Copper prices fell, following equities markets lower on concerns that the new bailout plan might not be enough to push the US economy into recovery, raising fears that demand will continue to decline.

March copper was down 4 cents to $1.58 per pound in New York while three-month copper dropped $95 to $3,485 per tonne on the London Metal Exchange.