Gold price sets all-time high
LONDON, October 6, 2009 – Gold jumped to a record peak above $1,040 per ounce today, driven by a falling U.S. dollar and worries about potential inflation.
Gold has benefited from concerns among investors that the giant U.S. economic stimulus package and bank bailouts could fuel inflation. Gold is seen as a hedge against inflation.
Spot gold hit a historic $1,043.45 per ounce today, but this level was still sharply below the inflation-adjusted record highlighted by analysts. Metals consultancy GFMS put that figure as high as $2,079 an ounce.
The dollar fell after UK newspaper the Independent said Gulf Arab states were in secret discussions to end the use of dollars in oil trading. Big oil-producing countries later denied the report.
The fourth quarter of the year is typically strong for gold, due to rising jewellery demand. Traders noted increasing demand in India, the world’s largest gold consumer, before the Diwali festival on October 19.