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Friday, 16th June 2006 (4584 views)

A strengthening oil market and weakening US currency combined to help gold prices jump by three percentage points on the world stock markets today (June 16).

Analysts are still cautious to predict that gold price drops are past the worst but remain positive on its prospects, despite the fact that the value of the precious metal could have been better but for an easing back in prices towards the end of the day.

"We were nervously bullish this morning," one London trader told Reuters. "Since then it has come down but we are still up."

The day's high on the Australian exchange was around $585 an ounce, but it finished at slightly less than $575 an ounce by the close.

Opinion is divided over which direction the gold price will be headed in the short term, although the metal's importance to the world economy cannot be overstated as it is a traditional hedge against inflation.

 

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