Gold price hits record high as global inflation spikes

April 15, 2011 | 16:31

(0) user say

The price of gold reached a record high close to $1,480 an ounce in trading Friday with investors piling into the safe-haven precious metal amid spikes to global inflation and fresh eurozone debt worries.

Gold struck an all-time peak of $1,479.35 an ounce in early Asian trade, beating the previous high reached Monday by just over a dollar.

"It seems investors are still more concerned about the threat of debt-default by peripheral EU nations and rising inflation indicators following higher-than-forecast inflation readings from India and China overnight," said James Moore, analyst at research group Fast Markets.

The precious metal hit the new pinnacle shortly before China said that its inflation had hit a 32-month high, suggesting Beijing's efforts to rein in soaring costs are still falling short.

The consumer price index rose 5.4 per cent year-on-year in March -- the fastest pace since July 2008 and well above the government's 2011 target of four per cent -- and 5.0 per cent in the first quarter.

World Bank president Robert Zoellick had on Thursday already warned that rising food prices had reached dangerous heights.

Official data Friday meanwhile showed India's inflation rate unexpectedly accelerated in March, raising pressure on the central bank for a further hike in interest rates.

And separate figures published before the weekend showed prices rocketed to 2.7 per cent last month across the debt-ravaged eurozone.

AFP

What the stars mean:

★ Poor ★ ★ Promising ★★★ Good ★★★★ Very good ★★★★★ Exceptional