Gold prices surge as weak dollar pushes precious metal above $1,300
Gold prices reached a 15-month high today as concerns around the strength of the US dollar and general volatility in the currency markets pushed up the price of the safe haven asset.
The price of an ounce of gold broke through the $1,300 (£888) mark for the first time since January 2015 on Monday morning – up 0.5 per cent on the day, with futures markets indicating the precious metal will stay around this level for at least the next month.
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The US dollar slumped to an 11-month low last week as the pound recovered some if its lost ground after Barack Obama issued his Brexit warning, and the Japanese yen surged off the back of some confusing messages from the Bank of Japan.
The price of gold has risen by 23 per cent since the start of the year – where it opened at $1,061 – but is still significantly off the heights of nearly $1,900 reached in 2011.
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"The dollar is very weak, especially against the yen, and the white metals all look very healthy, so maybe on the back of that gold may get a bit of a follow through," Afshin Nabavi, head of trading at MKS told Reuters.
The $1,300 mark is seen as a key psychological barrier, and today's price surge could encourage profit-taking which might send the metal back down once trading volumes pick up after tomorrow after public holidays across much of Asia and Europe.