The price of gold, a safe-haven investment in times of economic uncertainty, struck an all-time high above $1,267 an ounce today.
Gold hit $1,267.25 on the London Bullion Market this afternoon. This beat the previous record of $1,265.30 an ounce struck on June 21.
Analysts said that renewed sovereign debt concerns drove up gold prices. Fears of a resurgent euro zone debt crisis are likely to stunt European economic growth prospects this year, the EU warned yesterday.
'The global recovery is still expected to be uneven and is surrounded by major uncertainties,' the European Commission said in its autumn forecast. It cited 'the resurfacing of global imbalances, high debt levels and lingering tensions in sovereign-debt markets."
Gold, whose two main drivers are jewellery and investment buyers, is also regarded as a good store of value in times of high inflation.
Amid rising bullion prices, the International Monetary Fund last week said it was selling gold worth around $403m to Bangladesh. The Washington-based institution has been selling gold as it seeks to bolster its finances amid the global economic crisis.
IMF members agreed in 2008 that the fund could sell an eighth of its gold assets in order to diversify its financial model. The fund is one of the world's largest holders of the precious metal.
World oil prices down from one month high
Oil prices remained below Monday's one-month high this evening, with traders reluctant to take strong positions ahead of eagerly awaited US inventory numbers tomorrow.
US crude was trading at $77.27, up eight cents on Monday's close, but well below Monday's peak of $78.04 - the highest value since August 11. Brent was 38 cents higher at $79.55.
Prices had surged on Monday as the shutdown of the biggest Canada-US pipeline, run by Calgary-based pipeline giant Enbridge, continued.
The shutdown entered a fifth day on Tuesday, but traders said markets had become wary of taking strong positions ahead of US oil inventory figures from the Energy Information Administration on Wednesday.
Crude stockpiles at Cushing, Oklahoma, the pricing point for US crude, have remained high for most of the summer, despite a series of drops in the past few weeks.
This week's inventory reports were expected to show little change in stocks of US products.
