Nearing $800, gold is on a roll

Gold is making a run for $800 an ounce, a level it hasn’t visited in 27 years.

Near-term gold futures in New York rose $5.20 to $789.10 an ounce on Monday, the highest closing price since January 1980.

“It is extremely likely gold will get through $800 in the short term -- over the next few weeks -- maybe even sooner,” said Peter Richardson, strategist at Craton Capital, a South African investment firm.

Gold has risen $100 in the last two months alone.

Speculators and investors continue to pour into the metal, egged on in part by surging oil prices and the falling dollar, traders say.

Record oil prices are viewed as inflationary, boosting gold’s status as an inflation hedge. The falling dollar, meanwhile, makes gold look more attractive relative to paper currencies -- at least in the minds of some traders.

One U.S. dollar was worth 95.3 Canadian cents on Monday, down from 96.2 cents on Friday and the lowest since 1960. The euro hit an all-time high of $1.442 on Monday, up from $1.439 on Friday.

If the Federal Reserve cuts short-term interest rates on Wednesday, as Wall Street widely expects, the downward pressure on the dollar could intensify, analysts say.

Some say profit-taking could send gold lower after it crosses the $800 mark. But Frederic Panizzutti, analyst at MKS Finance, said that although “profit-taking always remains a risk . . . it’s not a major concern. We expected it at $720, $750, and $780 and we haven’t really seen any sharp correction so far.”

Adjusted for inflation since 1980, gold would have to rise to about $2,100 an ounce to equal its 1980 peak price of $873.