“Gold rose above $1,600 an ounce in London for the first time this month after an unprecedented levy on bank deposits in Cyprus increased demand for a protection of wealth.
Cypriot President Nicos Anastasiades bowed to demands by euro-area finance ministers to raise 5.8 billion euros ($7.5 billion) by taking a piece of every bank account in Cyprus. The country became in June the fifth euro-area nation to request a rescue. The euro fell to the lowest since December versus the dollar and global equities declined.
“Gold looks poised to benefit from its safe-haven properties amid renewed risks coming out of the euro zone,” Joni Teves, an analyst at UBS AG in London, wrote today in a report. “As people start to worry about the safety of their deposits, gold would become an attractive alternative and an escalation of these worries would prompt a return of fear- related physical buying.”
Gold for immediate delivery rose 0.7 percent to $1,603.68 an ounce by 9:49 a.m. in London. Prices reached $1,608.60, the highest since Feb. 27, and added 0.8 percent last week. Futures for April delivery were up 0.6 percent at $1,602.40 on the Comex in New York. Futures trading volume was 56 percent above the average in the past 100 days for this time of day….”
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