Gold rose to a record in New York and London on speculation that a weakening dollar and faster inflation will boost the appeal of precious metals. Platinum and palladium climbed to the highest prices in more than a year, and silver advanced to its costliest since July 2008. Bullion, which usually moves inversely to the dollar, is on course for a ninth annual gain after the dollar dropped 6.6 percent this year against a basket of six currencies. Futures reached $1,069.70 an ounce in New York, while spot gold climbed to $1,068.63 in London, surpassing the previous highs on Oct. 8. “There’s lots of concern about the weakness in the dollar, and this has been driving gold,” Peter Fertig, the owner of Quantitative Commodity Research Ltd. in Hainburg, Germany, said by phone. “The fear that central bank exit strategies will come too late to prevent inflation is giving support to gold.” December gold futures gained $8.60, or 0.8 percent, to $1,066.10 an ounce on the New York Mercantile Exchange’s Comex division by 8:41 a.m. local time. The metal has advanced 20 percent this year. Immediate-delivery bullion was 0.7 percent higher at $1,065 in London. Gold rose in the morning “fixing” in London, used by some mining companies to sell production, to a record $1,064.50 an ounce from $1,058.75 at yesterday’s afternoon fixing. Record U.S. Debt “As we start to see more evidence of economic recovery, we might see the momentum catalyst push gold higher,” said Darren Heathcote, head of trading at Investec Bank Ltd. in Sydney. President Barack Obama has increased U.S. marketable debt to a record as he borrows to reignite growth in the world’s biggest economy. That’s boosted speculation increased money supply will debase the currency and spur inflation. The Federal Reserve has cut its main interest rate almost to zero and backed asset purchases and credit programs to combat the recession. Chairman Ben S. Bernanke is leading plans to buy mortgage-backed securities, federal agency debt and Treasuries. U.S. consumer prices will expand 1 percent this quarter and 1.9 percent and 1.8 percent in the following two quarters respectively, according to the median estimate of 66 economists surveyed by Bloomberg. Oil futures, used by some investors as an inflation guide, gained as much as 1.6 percent to $74.47 a barrel today in New York, after climbing 2.1 percent yesterday. The U.S. Dollar Index, which last week dropped to the lowest level in almost 14 months, was 0.3 percent lower today. Silver, Palladium Other precious metals have outperformed gold this year. Silver futures climbed 59 percent this year, while platinum, which advanced to a 13-month high today, is up 45 percent. Palladium, the best-performing precious metal in 2009, has jumped 78 percent and reached a 14-month high today. Gold holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, were unchanged for a third day at 1,109.31 metric tons yesterday, according to the company’s Web site. Assets in ETF Securities Ltd.’s exchange-traded products added 0.3 percent to a record 8.441 million ounces yesterday, its Web site showed. “There is less obvious support for the current price from the fundamentals of supply and demand excluding investment,” Citigroup Inc. said in a report. “Mine supply has recently been sufficient to meet all fabrication demand. Excess demand for gold must therefore be supported by investors.” Higher Forecast Gold will trade at $1,025 an ounce in the next three months, up from a previous forecast of $950, Citigroup said in the report, citing increased demand and a weakening dollar. The bank raised its estimate for the coming six to 12 months to $1,050, from $975. Silver for December delivery in New York rose as much as 1.4 percent to $18.075 an ounce, the highest price since July 22, 2008, and was last at $17.95. An ounce of gold now buys about 59.3 ounces of silver in London, according to Bloomberg data. That’s down from a high of 84.4 ounces in October last year, which was the most since 1995. Palladium for December delivery jumped as much as 2.5 percent to $337.90 an ounce, the highest price since Aug. 11, 2008, and was last at $335.45. Platinum for January delivery added 1.5 percent to $1,367.50 an ounce, after earlier reaching $1,370, the highest price since Sept. 8, 2008.

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