Gold futures on the COMEX Division of the New York Mercantile Exchange on Friday topped the psychological mark of US$1,300 per ounce in the morning session, buoyed up by weakness in the dollar. Silver further headed up in the day.

The most active gold contract for December delivery gained US$1.8, or 0.1 percent, to close at US$1,298.1 per ounce on the floor.

The dollar fell against a basket of currencies on Friday to its lowest level since February as stronger-than-expected data in Europe and a drop in US durable goods orders hurt demand for the greenback. Besides, the lower-than-expected new home sales further intensified expectation for the quantitative easing policy and thus made things worse.

A weaker dollar makes gold cheaper for holders of other currencies, so gold tends to benefit as the dollar falls.

However, some traders noted that gold is currently overbought and this raises the chance of a correction over the near term.

Silver further headed up while platinum reversed. December silver gained 18.6 cents, or 0.89 percent, to US$21.399. In contrast, October platinum closed at US$1,639.8 per ounce, shedding US$6.1, or 0.37 percent, from the prior trading day.

(Xinhua News Agency September 25, 2010)