Gold futures rose Thursday as traders bet that the Federal Reserve will again lower interest rates to stave off a recession, boosting the appeal of precious metals as a hedge against inflation, according to AP. Other commodities increased broadly, with energy and agriculture future trading higher. The Bank of England on Thursday cut its benchmark interest rate by a quarter point to 5.25 percent in a move widely expected by economists. The European Central Bank left its key rate unchanged _ but appeared to leave some room for a future reduction amid concerns that a slumping U.S. economy could slow growth in other countries. The U.S. Federal Reserve last month slashed rates by a total of 1.25 percentage points, and investors are already predicting more cuts to come. «Metals prices are starting to factor in another rate cut, probably another half-point cut,» said Michael Gross, futures analyst with OptionSellers.com. «Gold is gaining strength on belief that the Fed is going to cut to try and stabilize things.» Lower interest rates can boost the economy but also depress the U.S. currency, raising the possibility of higher inflation and leading investors to shift resources into hard assets like gold. Gold for April delivery rose $5 to settle at $910 an ounce on the New York Mercantile Exchange, after earlier hitting a high of $915.20. Gold plunged $19.10 on Tuesday to its lowest level in two weeks. Supply concerns also lifted gold Wednesday after AngloGold Ashanti Ltd., the world's third-largest gold producer, warned of a possible 400,000-ounce production loss because of an energy crisis in South Africa that has slowed mining operations. «The possibility of a wider or more prolonged loss of production (in South Africa) is adding to gold's turnaround,» Jon Nadler, analyst with Kitco Bullion Dealers Montreal, said in a note. Other precious metals also rose. Platinum for April delivery hit a record $1,855 an ounce before easing back to settle at $1,851.40 on the Nymex, up $32.40. March silver added 22.5 cents to $16.775 an ounce, while March copper gained 14.5 cents to $3.4540 a pound. In agriculture markets, wheat futures continued their record-breaking climb as buyers scrambled to lock in dwindling supplies of high-quality milling wheat used in bread, pasta and other food. Wheat for March delivery hit the 30-cent daily limit to settle at a record $10.63 a bushel on the Chicago Board of Trade. It was the second straight day that wheat hit an all-time high. Other agriculture futures traded mixed. March soybeans added 13 cents to settle at $13.315 a bushel on the CBOT, while March corn fell 2 cents to $4.995 a bushel. Meanwhile, oil futures rose Thursday as the stock market's relative stability after days of steep declines calmed investors' worries about the health of the economy. Light, sweet crude for March delivery rose 97 cents to settle at $88.11 a barrel on the Nymex after earlier falling as low as $86.24, its lowest price in more than two weeks. Other energy futures rose. March heating oil rose 3.97 cents to settle at $2.4585 a gallon on the Nymex, while March gasoline futures rose 2.79 cents to settle at $2.2678 a gallon.
