Gold soared to its highest price since early November yesterday, and the U.S. dollar was hit by selling pressure that substantial intervention by central banks -- including the Federal Reserve -- could not counteract completely.
Gold closed in Zurich at $227.375 an ounce, up from $220.875. In London, it closed $7.25 higher at $228.625. These were the highest prices for gold since Nov. 1, when it closed at more than $239 an ounce.
Dealers said the factor behind gold's rise was that the 1.5 million ounces of gold offered by the U.S. Treasury at Tuesday's auction found plenty of ready buyers at an average of almost $220 an ounce.
In Frankfurt, the dollar fell to 1.8455 West German marks from 1.8515; in Zurich, to 1.6710 Swiss francs from 1.68175; in Paris, to 4.2375 French francs from 4.2475; and in Milan, to 832.90 lire from 839.20.
In Brussels, it eased to 29.565 Belgian francs from 29.6750; and in Amsterdam, to 1.9885 guilders against 1.9895.
In London, the pound rose to $2.0065 from $2.0025 despite what a London dealer called "a grim background of industrial dispute. The pound's resilience reflected the dollar's weakness, not any inherent strength."
In Tokyo, the dollar finished the day at 196.80 yen, down from 198.