Foreign Exchange for Friday, Aug. 8, 1986 : Precious Metals Jump; Dollar Falls
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NEW YORK — Precious metals prices, led by platinum, jumped Friday on new optimism about the metals. Trading was frantic here as dealers rushed to cover agreements to sell the metals.
Platinum rose $25 an ounce, the limit allowed, to its highest level in five years. Gold rose as much as $13 an ounce to its highest level in two years.
The dollar was mostly lower against major foreign currencies.
Several factors sparked the rally, the analysts said. Prices began to rise on buying interest from Japan, the Middle East and the Swiss banks, they said. Then, as the market built up momentum, prices passed key technical points and technical buying developed.
The analysts also cited the declining dollar, a rally in the bond markets, steadier oil prices, the overall weak economy, fears that South African turmoil would disrupt platinum supplies and concern about President Reagan’s health. South Africa is a leading producer of platinum.
Barbanel said: “When you start mounting all of these factors together, you have a very strong momentum to the upside.”
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