Gold May Extend Best Run of Weekly Gains Since October on Mideast Turmoil in Trade forex online

Gold may gain in London, extending the longest weekly run since October in Trade forex online, as turmoil in Libya and concern inflation will accelerate boost demand for an alternative investment.

Libyan opposition leaders rejected a mediation offer by Venezuelan President Hugo Chavez as armed rebels held out against regime attacks and prepared to push toward the capital, Tripoli.

Gold fell the most in five weeks yesterday after reaching a record $1,440.32 an ounce on March 2.

Immediate-delivery bullion rose $1.85, or 0.1 percent, to $1,417.85 an ounce at 11:19 a.m. in London. It’s up 0.5 percent this week, set for a fifth weekly advance. Gold for April delivery was 0.1 percent higher at $1,418.30 an ounce on the Comex in New York.

Gold fell to $1,418 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,421.50 at yesterday’s afternoon fixing.

Prices slipped 1.3 percent yesterday as the Arab League held talks with Venezuela about Chavez’s call for a “mediation commission.” Opposition spokesman Mustafa Gheriani said “we do not accept any negotiations” with Libyan leader Muammar Qaddafi, according to the Associated Press.

Concern about rising inflation and currency debasement drove gold prices up 30 percent last year for a 10th annual gain.

Asian countries from China to Indonesia raised interest rates this year to curb rising consumer prices. Increasing food and commodity prices have contributed to unrest that toppled leaders in Tunisia and Egypt, with protests also erupting in Yemen, Bahrain, Oman, Jordan, Algeria, Morocco, Iran and Iraq.

As oil has climbed above $100 a barrel in New York, mounting inflation pressures in Europe prompted European Central Bank President Jean-Claude Trichet yesterday to say the ECB may raise rates next month for the first time in almost three years.

Silver for immediate delivery was up 0.8 percent at $34.48 an ounce after climbing to $34.985 on March 2, the highest price since March 6, 1980. That year the metal reached a record $50.35 in New York. Silver held in exchange-traded products rose 72.9 metric tons to 14,955.8 tons yesterday, the highest level since Jan. 10, data compiled by Bloomberg from four providers show.

Palladium declined 0.5 percent to $810 an ounce. It touched a 10-year high of $862.25 on Feb. 21. Platinum was little changed at $1,830.20 an ounce.