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The price of gold popped above $1,100 per ounce in early trading before the December contract settled at $1,095.70, up $6.40.
Factors cited for today's gain included a 0.4 percentage increase in the unemployment rate to 10.2% (see Recovery fails to generate jobs as unemployment rate exceeds 10%), which almost guarantees that the Fed will be holding interest rates at current levels through the early part of 2010.
Fears that central banks around the world want to diversify away from the dollar have also played a large role in the shiny metals advance.
Foreign countries and overseas investors have traditionally parked excess cash into the greenback because of this country's deep capital markets, political stability, and certainty that the US will not default on its debt.
But fears are growing that the large budget deficits may soon become a burden, which has weighed on the dollar and added to gold's luster.
Some analysts have also pointed to worries that rampant inflation will overtake the shores of the U.S. economy. But Treasury yields remain low and muted expectations regarding inflation are not signaling an impending jump in prices is on the horizon. At this point, most of the rise in gold can be traced back to problems with the dollar.
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