Gold surges as stocks continue to slide
Adam Pike, News Editor
27 Jan 2016, 4:55 p.m.
The gold price has climbed to a six month high as investors seek a safe haven from falling equity prices. The gold price has now risen £65 per ounce since the start of 2016. Overnight the main Chinese Stockmarket fell 6.42% and this morning the FTSE 100 has retreated a further 1.5%. In the last 7 months $15 trillion has been wiped off the value of global equities.
The yellow metal has re-established itself as the go to asset class when equities and other assets fall.
The recent volatility in global stock markets and poor economic data has prompted traders to reduce bets the Federal Reserve will increase interest rates. The gold price usually has an inverse relationship with interest rates so any rate delay will boost golds appeal.
Investors have added over $1 billion into gold backed exchange traded funds since the start of the year. Total holdings in ETF’s now exceed 1,500 metric tons, the highest amount since November 2015.
Currently gold is trading at £784.35 per ounce, silver £10.09 per ounce, platinum £607.01 per ounce and palladium £348.83 per ounce.