HONG KONG -- Global commodities markets were bubbling on Friday after gold briefly peaked over $1,000 an ounce, oil hit new highs and the dollar tumbled to a record low against the euro.
Hong Kong gold prices opened higher and edged towards the symbolic $1,000 an ounce mark breached for the first time Thursday on the London Bullion Market.
The plunging dollar and the precious metal's traditional role as a safe haven amid fears of rising inflation have caused gold prices to surge about 17 percent so far this year.
Investors are funnelling cash into commodities generally as they seek a refuge from volatile world stock markets and growing fears of a US-led economic slowdown, traders said.
On Friday Hong Kong gold prices opened markedly higher at $994.00-$994.50 an ounce, up from Thursday's close of $987.10-$987.60.
Oil simmered down on Friday after hitting a record $111.00 per barrel on Thursday, but analysts said prices remained on the boil due to the ailing greenback.
New York's main oil futures contract, light sweet crude for delivery in April, was at $109.75 per barrel in Asian trade, down 58 cents from its all-time closing high of $110.33 in New York.
In earlier frenzied US trading, the contract had struck $111.00 for the first time.
"We are seeing only a marginal movement," said David Moore, a commodity strategist with the Commonwealth Bank of Australia in Sydney, noting that prices remained high.
The dollar sank on Thursday to fresh lows against the euro and slid below 100 yen for the first time in 12 years as traders were rattled by weak US data and credit market turmoil.
The greenback held up above 100 yen on Friday at 100.76 yen in Tokyo late morning trade. The euro softened to $1.5607 but remained close to its all-time high of $1.5645.
"For the dollar, investors are becoming increasingly alert to the unfavorable mix of negative data, rising inflation expectations and the possibility of a deeper and longer lasting (US) recession," said Commerzbank analyst Gavin Friend.
Many analysts now expect the US Federal Reserve to cut its key lending rate by as much as three-quarters of a point next week. Investors generally prefer the currencies of countries that have higher interest rates as they can reap better yields.
In Washington, US Treasury Secretary Henry Paulson insisted Thursday that a strong dollar "is in our nation's interest" and said he would like to see the currency strengthen.
Paulson acknowledged that the US economy was suffering as he answered reporters' questions on the dollar.
But he added: "Our economy, like any other, has got its ups and downs but the long-term fundamentals are strong and I believe it's going to be reflected in the currency market."
In Asian markets Friday, Hong Kong's Hang Seng Index opened up 1.05 percent after a 4.8-percent fall the previous day, while Japanese share prices were mixed in morning trade.
