LONDON (AFP) — The price of gold hit an all-time peak of 876 dollars an ounce here on Tuesday owing to rebounding oil prices, a weak dollar and geopolitical tensions, traders said.
Gold is seen as a defence against inflation, which in many countries is driven by runaway crude prices. The precious metal is also seen as a safe haven amid global unrest, which on Tuesday was being fuelled by tensions between Iran and the United States.
Meanwhile a weak dollar makes gold cheaper for buyers using stronger currencies.
After striking a record 876 dollars, the price of gold settled back to 872.91 dollars an ounce on the London Bullion Market.
Gold's new historic record beat the previous all-time pinnacle of 868.89 dollars set last Thursday amid unrest in Pakistan, a faltering dollar and as oil struck an historic peak above 100 dollars a barrel.
Prior to gold's recent historic surge, the yellow metal had hit a then-record of 850 dollars per ounce in 1980 amid inflationary fears that were sparked by runaway oil prices amid the Iranian revolution.
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