Thursday, 17th November 2005 (3662 views)

Gold has hit a 17-year high in Asia, due in part to its investment value.

It has today been trading in Asia at above $481 an ounce.

"A lot of factors that have been traditionally driving gold are turning quite negative and gold is ignoring all these signals in the current rally," Yingxi Yu, precious metals analyst at Barclays Capital told Reuters.

Experts are expressing varied views. Some are predicting that gold will break through the $500 barrier, while others suggest that the high prices may deter jewellery buying in India, thereby preventing further rises.

This comes as the central banks of both Russia and Argentina are contemplating increasing their gold reserves to protect against inflation.

Along with the current Indian wedding season, the upcoming Christmas season could see more demand for gold jewellery.

 

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