Gold reaches US$1300 record high

The
price of gold has risen above $1,300 an ounce for the first time.

The
price of the precious metal reached $1,300.07 during trading at the London
bullion market, before dipping back.

The
latest rise has been spurred by caution over the global economy, as well as
weakness in the US dollar – the currency used to value gold – which fell 1%
against the euro.

The gold
price has increased five-fold in the last 10 years, up from a low of $258 in
2000.

One of
the factors spurring investors is gold’s traditional role as a so-called
“safe-haven” investment at times of economic uncertainty.

Another
driver is more technical – gold is priced in dollars, and any fall in the
dollar makes it cheaper to buyers using other currencies.

The
World Gold Council’s last report on the gold market predicted that continuing
strong demand from jewellery buyers in the two fast-developing markets of India
and China would help to keep the price high.

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