Gold reaches seven-year high as investors search for security amid coronavirus fears

Gold reaches seven-year high as investors search for security amid coronavirus fears

On Monday, gold prices rose by more than 2 per cent to their highest levels since February 2013. Spot gold and US gold futures rose to more than $1,663 as analysts predict their prices head for $1,700.

Investors have flocked to gold as a considerably secure asset amid the coronavirus outbreak. Several countries outside of China are now seeing cases of the virus rise, resulting in increasing worries about a hit to global economic growth, therefore severely affecting share prices.

Milan’s main index was worst hit, falling more than 4%. Italy has seen Europe’s worst outbreak of the coronavirus and the government has announced a series of drastic measures, with a lockdown in place in several small towns.

Michael McCarthy, chief market strategist at CMC Market, said: “The thinking is that fewer people are holding shares, selling down in particular, and that money has to fall into havens,”

“The impact on the global economy also means we will likely see a lower interest rate environment for longer.”

“Gold has finally established some serious momentum,” said Jeffrey Halley, senior market analyst at online trading platform Oanda.

Among other precious metals, palladium inched up 0.3 per cent to $2,711.81 per ounce. Silver rose 1.1 per cent to $18.67 an ounce, while platinum fell 0.3 per cent to $970.36.

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