LONDON, March 26: Gold hit a one-week high on Wednesday as a falling dollar and firm oil prices encouraged investors to shift money back into the market after last week’s heavy sell-off.

Gold rose to a high of $948.80 an ounce and was quoted at $948.20/949.10 at 1102 GMT, against $934.60/935.40 late in New York on Tuesday.

We are still going to have another leg up towards $1,000, but I think it might be slower than the run up we saw the last time, said Suki Cooper, metals analyst at Barclays Capital.

Gold hit a record of $1,030.80 on March 17 before a broad sell-off in commodities dragged down prices to a one-month low of $904.65, briefly hurting investor confidence in the metal, seen as an alternative investment and a hedge against inflation.

Short-term we expect gold to remain vulnerable to profit taking as book squaring is seen before month/quarter-end, but support should remain strong in front of $900, said James Moore, precious metals analyst.

Gold futures for April delivery on the COMEX division of the New York Mercantile Exchange rose $14 an ounce to $949, but were off last week’s record high of $1,033.90.

Platinum was supported by supply fears following a power crisis in top producer South Africa. Palladium and silver also firmed but remained below their recent highs.

Spot platinum was at $1,985/1,995 an ounce, compared with $1,960/1,970 in New York on Tuesday and a record high of $2,290 hit on March 4.

South Africa’s Public Enterprises Minister Alec Erwin said on Tuesday that power utility Eskom’s ability to raise capital could be undermined if it was not allowed to raise tariffs.

Eskom has struggled to cope with rising demand due to years of underspending on generating capacity.

The energy grid came close to collapse in January, forcing gold and platinum mines to shut down for five days and driving platinum to record peaks.

Silver rose to $18.12/18.17 from $17.78/17.83 an ounce, while palladium was up at $450/455 an ounce, versus $442/447 in the US market late on Tuesday.—Reuters