Gold prices jump on rumors that weaken US dollar

Gold prices were much higher Tuesday, climbing to record highs after the US dollar weakened on reports in the UK newspaper The Independent that Gulf Arab states, along with other oil producers including Russia, China, Japan and France have held secret talks aimed at displacing the greenback as the currency in which oil is traded.

The dollar fell and gold climbed even after the reports were denied by those named as parties to the alleged discussions.

Spot gold hit a record high at $1,043.45 per troy ounce during the session, while December contracts went as high as $1,045 per troy ounce in New York before easing slightly to a gain of $21.90 on the session to $1,039.70 per troy ounce.

Other precious metals followed gold higher, with December silver up 76 cents to $17.30 while January platinum added $23.50 to $1,325.30 per troy ounce.

Earlier, in mid-morning trade, December palladium was up $3.15 to $306.45 per troy ounce.

Even before the session’s gains, palladium prices had added 61 percent since the beginning of the year.

Among base metals, meanwhile, December copper added 6 cents to $2.78 per pound in New York on data released Monday by the Institute for Supply Management which showed that the US services sector expanded in September for the first time in a year.

Homebuilding, which uses significant amounts of copper, is included in the services sector.