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Tuesday, 17th January 2006 (5647 views)

The price of gold in Europe rose even higher on Tuesday, having hit a 25-year high of $562 an ounce on Monday.

Spot gold prices reached $564.30, the highest level since 1981, before dropping back to between $562 and $563.

Fellow precious metals platinum and silver also performed well, spurred on by the lingering threat of sanctions against Iran over the resumption of its nuclear energy programme.

The threat of some disruption to Nigerian oil exports and a weak outlook for the dollar also led to a surge of interest in gold as a comparatively safe option for investment.

The developments mean that gold has now increased by around nine per cent this year.

Markets were closed in the US on Monday in recognition of the Martin Luther King Jr Day holiday, with traders there unavailable to respond as a result.

However, analysts are now suggesting that the price of gold could well increase further, past $570, which could become an annual average.

There has also been unconfirmed talk of buying by Middle Eastern central banks.

 

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