Gold may top $2,000 in safety flight

The Daily Telegraph - Business - - Front Page - By Tom Rees

GOLD prices could surge above $2,000 (£1,587) per ounce this year for the first time amid a flight to safety as markets are bat­tered by the fall­out from Covid-19.

Wall Street an­a­lysts pre­dict that it is only a mat­ter of time be­fore the metal reaches record prices, af­ter a four-month surge to its high­est value for nine years.

Ed­ward Morse, global head of com­mod­ity re­search at Citi, said prices are likely to hit un­prece­dented lev­els in the next six to nine months. He put a 30pc chance on the $2,000 mark be­ing crossed in as lit­tle as three months’ time.

Savers typ­i­cally buy gold at times of cri­sis as it is seen as a safe store for value.

Its rally is likely to be helped if traders know they can make lit­tle money on other, more risky in­vest­ments. Gold prices ini­tially plunged in March as the full ex­tent of the Covid-19 cri­sis dawned on markets and in­vestors rushed for cash, sell­ing even tra­di­tional safe havens.

But gold has jumped 23pc since March’s nadir, surg­ing past $1,800 per ounce in the past few weeks to reach lev­els not hit since 2011. That built on a rally which be­gan last year be­fore the pan­demic rocked markets.

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