Gold price rises

Press, 21 October 1987, Page 44

Gold price rises

NZPA-AP New York

Gold prices rose to their highest levels in more than four years on Monday as Investors sought protection from hemorrhaging world stock markets. The US dollar closed lower against all major currencies except the Canadian dollar, but

analysts said activity was relatively quiet as traders were preoccupied by the dramatic activity in the New York stock market, which saw the Dow Jones Industrial average plunge 508.32 points to 1738.74, a decline of 22.61 percent. Republic National Bank In New York quoted a late

bid for gold of 8U5486.50 a troy ounce, up 8U515.50 from Friday’s fate bid. Gold prices have not traded as high since February 18,1983, when they closed at $U5505.70 a troy ounce on the New York Commodity Exchange. But some analysts said the price increase was disappointing in light of the extreme activity In the stock market.

"One would think gold would be a haven for money, but it’s starting to look like there’s so much money being lost in the stock market that there’s nothing left to put into gold,’ said an analyst,

But experts said activity in the precious metals markets could pick up.

"The long-term point of view Is if the situation gets serious and spills over Into the world economy ~. People worry about how sound the banks are, and that could drive money Into gold,* said August Arace, a managing director at Tucker Anthony and R.L. Day, Inc. brokerage firm. Bullion dealers said trading was heavy, On the New York Commodity Exchange, gold closed at $U5481,70, up from 8U5471.60 late on Friday, Silver benefited from gold's rise.