Daily Gold Update

Source:Marketwatch

New York— Gold futures surged to a fresh all-time record on Wednesday, building on Tuesday's gains as nervousness surrounding the European rescue package and its effects in the global economy boiled over. Gold for June delivery, the most active contract, gained $17.40, or 1.4%, to $1,237.30 an ounce on the Comex division of the New York Stock Exchange. That's the highest for a most-active contract since gold futures started trading in 1974. Silver rode in the coattails of gold's success to trade at its highest price since March 2008. The contract hit an intraday high of $1,245.40 an ounce, according to FactSet. It surpassed a previous intraday record for a most-active contract set in early December.

"While we continue to see the cyclical recovery in global growth … the risks to the recovery have clearly risen," analysts at Barclays said in a note to clients Wednesday. Gold is benefiting from concerns about the stability of the global financial system and the risk of currency debasement and inflation, they said. The currency risk "has arguably been heightened" by the European Union rescue plan of nearly $1 trillion, the analysts added. "The gold price has been supported over the past days by safe-haven demand on the back of ongoing concerns about Europe," said Anne-Laure Tremblay, metals analyst at BNP Paribas in London. See full story.