Gold Rises to Four-Week High as Dollar Declines

Gold rose to a four-week high after the dollar fell against the euro, boosting the appeal of the precious metal as an alternative investment. Silver also gained.

Gold futures for February delivery rose $13, or 1.6 percent, to $829.50 an ounce on the Comex division of the New York Mercantile Exchange. The price earlier reached $830.20, the highest for a most-active contract since Nov. 27.

Gold is headed for a seventh straight annual gain after surging to a 27-year high of $848 on Nov. 7. The price rose 23 percent in 2006, while the dollar fell 10 percent against the euro.

Gold also rose as some investors purchased the metal as a hedge against inflation. The UBS Bloomberg Constant Maturity Commodity Index, led by wheat, soybeans and energy, has gained 23 percent this year., Bloomberg
12/26/2007 1:06:36 PM