Business

Gold price hits record high on Libya unrest

gold coins
Image caption The gold price has been rising over the past month

The price of gold has hit a record high as investors worry about the political turmoil in Libya and spreading tensions across the Middle East.

The price on the London Bullion Market jumped more than $14 to $1,434.50 an ounce, topping the previous mark of $1,431.25, set in December.

Gold is traditionally seen as a haven for investors in times of uncertainty.

Unrest across the Middle East and North Africa fuelled a 6% rise in gold prices during February.

Analysts said that the political problems were pushing oil prices higher and fanning concerns about inflation and slower global economic growth.

"What gold needed was a catalyst, and it found it in the form of tensions that are surfacing in the Middle East and rising oil prices," said Mark Luschini from the brokerage Janney Montgomery Scott.

Mr Luschini added that investors saw gold giving them greater protection from inflationary pressures and political instability.

On the New York Comex exchange, the price of gold reached $1,434.40, a record for that market, before pulling back slightly.

Meanwhile oil prices, which have also been on the up since unrest broke out in North Africa and the Middle East, rose again on Tuesday.

In London, Brent crude rose 4.2% to $116.46, while US light, sweet crude rose 3.7% to $100.52.

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