American Bullion -- Gold Rises as Investors Seek Alternative to Holding Currency

Wednesday, April 21, 2010 at 06:00am

By Pham-Duy Nguyen

(Bloomberg) -- Gold rose for a second day on speculation that Europe’s debt problems may worsen, boosting demand for the metal as an alternative to holding currency.

Gold priced in euros reached a record as the 16-nation common currency dropped for the fifth straight day on Greece’s debt troubles. Before today, gold gained 28 percent in the past year, reaching a record $1,227.50 an ounce on Dec. 3.

“Given these sovereign-debt issues, you’re going to continue to see safe-haven buying come into gold,” said Matt Zeman, a metals trader at LaSalle Futures Group in Chicago. “Price declines are still being met with aggressive buyers.”

Gold futures for June delivery rose $5.30, or 0.5 percent, to $1,144.50 an ounce at 9:46 a.m. on the Comex in New York. The metal fell 2.2 percent last week.