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Gold continues its record run
09 November 2009 08:10 am
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Gold rose to a record high Monday as the dollar weakened against rival currencies.

December gold was up $12.80 to $1,108.50 an ounce in electronic trading, after climbing to an all-time trading high of $1,109.90 earlier.

Gold gained 5% last week on speculation that central banks around the world will begin buying more of the precious metal as an alternative to the dollar, which is the traditional global reserve currency.

The dollar fell Monday after a meeting of finance ministers from the Group of 20 major economies over the weekend ended without a definitive plan to tackle rebalancing global money flows.

The dollar index, which gauges the greenback's value against a basket of currencies, slid 0.9% to a two-week low of 75. So far this year, the dollar has lost more than 7% against its main rivals.

Gold has gained more than 23% this year, and many traders expect the rally to continue into next year given the outlook for continued weakness in the dollar.

A softer greenback makes commodities that are priced in dollars, such as gold, more appealing for investors using other currencies. As a result, gold often rises when the dollar weakens.

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