Gold soars to new high as investors run to the hills

The price of gold has soared to a new high of $1,610 per ounce as worried investors seek refuge from the Eurozone and US debt crises. The cost of silver has also increased to a two-month high of $40 per ounce.

Gold is traditionally seen as a safe haven in times of economic uncertainty – and this week sees particularly crucial meetings in the
eurozone and the US.

In Europe, leaders will meet on Thursday in an attempt to stave off a default by Greece and prevent Italy and Spain being drawn into their own debt crises. In Washington, Democrats and Republicans are at war over increasing the amount the US allows itself to borrow. If the debt ceiling is not increased this week, the country is likely to go into temporary default in August.

Michael Hewson of CMC Markets, said: "Gold hit another milestone... at $1,600 as investors lose confidence in the ability of politicians to get a grip with the debt problems weighing down on sentiment. More advances look likely."

Read a full report at BBC News. ·