Gold hits all-time high as investors seek haven

May 11, 2010 18:55

Gold prices hit an all-time high as demand surged to the highest level since the collapse of Lehman Brothers in 2008 amid volatile financial markets in Europe.  Spot gold in London surged to above $1,230 a troy ounce, surpassing the previous record set in December last year.

By Javier Blas and Jack Farchy in London via Financial Times

Gold prices in euro terms also hit a fresh all-time high of €969 an ounce in late trading in London on Tuesday, up almost 26 per cent since the beginning of the year.

Traders and coin dealers said buying was exceptionally strong from German and Swiss investors. In Frankfurt, gold sellers said that demand late last week was three to four times normal levels. The spike appears to reflect concerns in Germany about the potential inflationary impact of the European Central Bank’s decision to buy up eurozone government bonds in the wake of the Greek debt crisis.

Michael Kramer, president of Manfra, Tordella & Brookes, a large New York-based coin dealership, said: “The demand has been huge overseas. Most of it is ending up in Germany.” Edel Tully, precious metals strategist at UBS in London, added: “Coin demand is so intense that supply is struggling to match”.


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