The spot price of gold surged beyond $450 for the first time since 1988 today, as the US currency slumped to a fresh record low against the euro.
Gold's spot price jumped by $2.6 an ounce to as high as $452.15 - its highest level since June 1988.
Analysts said the gold market was focused 'on the continued dollar weakness'. The euro rose above $1.32 this morning for the first time, as the US currency buckled under the strain of imbalances in the US economy.
A weaker dollar makes gold, which is priced in the US currency on world markets, more attractive to buyers using other currencies. Gold is seen also as a good hedge against fluctuations in the value of the dollar.
