Gold

Gold (Forex Index pm fix) - Today's data summary

% change
+1.83%
Price dollars per ounce
1431.40
Change
+25.70
As of 01:06 27 Jun 2019

Gold (Forex Index am fix) - Today's data summary

% change
0.00%
Price dollars per ounce
1429.55
Change
0.00
As of 01:06 27 Jun 2019

Latest updates

Why has the price of gold gone up?

Today Programme

BBC Radio 4

Gold bars
Getty Images

The price of gold has gone up recently - in the last month, it rose by £200 an ounce, from just under £1,000 to just under £1,200.

But why has this happened?

"The bigger picture is about the US Federal Reserve and the direction of the US dollar. Gold is priced in US dollars, so when the dollar gets weaker, it becomes cheaper for the rest of the world to buy it," Shanti Kelemen, senior portfolio manager of Coutts Bank, explains to Today.

"The biggest buyer in the world of gold on a retail basis is India. Gold also doesn't pay any dividends. So when interest rates go down, the opportunity cost of holding something that doesn't pay that falls."

She says that these factors, together with tensions with Iran, have led to the price of gold soaring.

The real deal - why real interest rates matter

Gold bars
AFP

Neil Wilson is chief market analyst at Markets.com. Here's his explanation as to why gold prices are rising.

"Real interest rates are a much better guide for gold than just about anything else.

"Real interest rates are the difference between ultra-safe government bond yields and the expected path of inflation.

"With the Fed now expected to cut rates we could see real rates slip back to zero – where they were at points in 2015 and 2016. They could even become negative like there were in 2012/2013.

"Real rates matter for the yellow metal since gold offers no yield – so the opportunity cost of holding gold is a lot lower if real rates are low. If they are negative , then it actually pays to hold gold.

"A weaker dollar is also a big factor since gold, like all commodities, is priced in dollars. So the weaker the buck, the more of them you need to buy the same amount of gold. Therefore prices measured in dollars rise.

Why did Gordon Brown flog our gold?

BBC Radio 5 Live

Wake Up To Money

Gold bars
Getty Images

Today marks the 20th Anniversary of then-Chancellor Gordon Brown flogging off half of the UK's gold reserves.

Laurie Lambie of Investec spoke about the event on today's Wake Up To Money.

She pointed out: "He was one of a number of Chancellors around the world who decided it was a good idea to sell-off gold and the basis of that was rather than use it as collateral, you could tweak policy by using interest rates to do that.

"The other thing you have to think about is what did he do with the money that he got for the gold?

"That went into bonds and currency so you have to weigh up the cost benefit of that."

Gold price gets shine from waning risk appetite

Gold rose 1% to briefly breach $1,300 an ounce on Monday before falling back.

"There's a little bit of easing risk appetite, the US dollar is weak and we saw [the] Chinese central bank's acquisition of gold for a fourth month.

"A combination of all these factors have moved gold into the $1,300s," said Bart Melek, head of commodity strategies at TD Securities in Toronto.

Gold glitters

Gold bars
AFP

The gold price has hit a near-four week, underlining worries about global growth and the US Federal Reserve's cautious comments on the country's economy.

The metal, a haven for investors in uncertain times, reached $1,323.42 and is currently trading 0.65% up at $1,322.08.

Ancient 'Sky Disc' was made with Cornish gold, researchers find

BBC Radio Cornwall

An ancient artifact that was discovered in 1999 was partially made using gold from Cornwall.

The Sky Disc of Nebra is 3,600 year old Bronze-age astronomical disc, used to determine the seasons for sowing and harvesting in the Halle area of Saxony-Anhalt in Germany.

Gold nuggets from the Carnon valley near Truro were recently discovered at Caerhays Castle on the Roseland, and they have proved to match the type of gold used to decorate the disc.

Courtenay Smale, the curator of the Caerhays Mineral collection, and Professor Gregor Borg of the Martin-Luther University in Halle-Wittenberg, Germany have been speaking to BBC Radio Cornwall Breakfast:

Gold nuggets found at Caerhays Castle proved the link with the historic German artifact.