Gold hits record on recession, inflation fears
( dpa ) - Gold raced ahead to a record high of 876 dollars an ounce Tuesday amid renewed global inflation and recession fears.
Tuesday's 2.1-per-cent rise in the price of gold, which breached the record set earlier this month, coincided with the dollar slipping again against the euro and another increase in the oil price.
Apart from fears that the US economy could be on the brink of recession, market worries about the geopolitical situation have been heightened by the news of a standoff in the Straits of Hormuz between US warships and Iranian boats.
This, combined with high oil prices, a poor performing dollar and weak supplies from mines, helped to drive up the price of the precious metal.
The price of gold tends to track oil prices because it is considered by investors to be a hedge against inflation with a weakening dollar also underpinning the gold price because many commodities of denominated in the US currency.
Indeed, while the price of gold rose, the oil price climbed 0.5 per cent to 95.55 dollars a barrel after falling back from hitting a record of 100-dollars-plus a barrel in recent weeks.
Meanwhile, the dollar slipped 0.1 per cent to 1.4709 against Europe's common currency in early European trading.