'Safe haven' gold now hits $1,800 per oz
Published 11/08/2011 | 05:00
GOLD futures extended a rally to a record, topping $1,800 an ounce, on mounting demand for a haven as global equities plunged amid escalating US and European debt woes.
For a fifth straight day, the US Dow industrials shifted by more than 400 points from the session high to the day's low. US financial stocks led the slide on worries that any French bank problems could spread to them. An index of European bank shares dropped 6.7pc and the KBW index of US bank stocks slid 4.9pc. Bank of America Corp was down 6.6pc at $7.10.
The drop came a day after stocks rallied on the Fed pledge to keep interest rates near zero for at least two more years.
The euro dropped as much as 1.5pc against the dollar, and the yen strengthened close to a post-World War Two high against the greenback. Gold has climbed almost $150 this week.
Bank of America Merrill Lynch raised its 12-month gold-price forecast to $2,000 on the increased chance for another round of US asset purchases, known as quantitative easing. (Bloomberg)