Gold Leads Commodities Rally on Oil Gain, Dollar Drop

[SlowDownFast]

Gold Leads Commodities Rally on Oil Gain, Dollar Drop (Update5)

By Glenys Sim and Christian Schmollinger

Jan. 3 (Bloomberg) -- Gold and platinum rose to records for a second day and crude oil traded near $100 a barrel as the dollar's slump enhanced the appeal of raw materials as an inflation hedge.

Agricultural commodities also rallied as wheat had its biggest two-day increase in four months, palm oil reached a record, soybeans traded near a 34-year high and corn neared an 11-year peak. Metals including gold, which rose beyond $850 an ounce for the first time yesterday, have more to gain, Evy Hambro, managing director of BlackRock Investment Management Ltd., said today.

``We see fantastic strength likely in gold and platinum,'' Hambro, whose $15 billion World Mining Fund rose the most among Europe's 10 largest stock funds last year, told Bloomberg Television. ``We see strength across most commodities prices, from agricultural products whether it's grapefruit or corn.''

The UBS Bloomberg Constant Maturity Commodity Index of 26 commodities climbed 22 percent last year, its sixth straight annual increase, powered by advances in wheat and soybeans. It was up 9.29 at 1,314.907 at 1:25 p.m. London time. The Reuters/Jefferies CRB Index of 19 raw materials gained as much as 1.11 to a record 367.97.

Gold jumped 31 percent in 2007 as the dollar slid to a record low against the euro and crude oil jumped amid increased tension in the Middle East. Some investors buy bullion to hedge against declines in the U.S. currency and accelerating inflation.

more:
http://www.bloomberg.com/apps/news?pid=20601087&sid=a6caV84QIEUY&refer=home

[Double T]

1. What a GD disaster in the works.

Rising commodities and a continually falling US dollar; we're so screwed.