Gold Price Hits Record High

The price of gold has hit a fresh record high, as investors seek out safe-haven assets to protect against inflationary and geopolitical risks.

Gold rose above $3,500 (£2,614) an ounce, surpassing its April peak. It has nearly doubled in value since early 2023. The rally comes as the US dollar has weakened and some central banks add to their gold holdings, ditching US government bonds, known as US treasuries.

At the same time, long-term borrowing costs rose to multi-year highs in the UK, France and Germany.

The UK stock market declined along with indices across Europe, and Wall Street joined the sell-off when US markets reopened after Labor Day. The FTSE 100 index of blue-chip companies had fallen by 64 points – or 0.7% – to 9,131 points on Tuesday afternoon, receding from the record intraday high of 9,357 points set last month.

France’s 30-year government bond yields jumped to their highest levels in more than 16 years on Tuesday, as investors rushed to sell French debt. Germany’s 30-year government bond yield has risen to a 14-year peak, in line with higher US treasury yields, while Italy’s 30-year yield reached its highest level since April.