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Gold hits 25-year high amid Iran, bird flu threats

Gold hits 25-year high amid Iran, bird flu threats

Gold rose to a 24-year high in New York and London, capping its third weekly gain, as investors bought the metal to diversify and seek higher returns. Shares of gold producers such as Newmont Mining Corp. surged.

Gold is "becoming an insurance policy against any type of disruptive risk," Frederic Panizzutti, a senior vice president at MKS Finance, a Geneva-based precious-metals trading and refining company, said in a report yesterday. "Most portfolio managers believe that gold is an asset which should not be missed in their portfolios."

Gold for immediate delivery gained rose US$10.59, or 1.9 percent, to US$556.99 an ounce at 5:52 p.m. in London on Friday, after earlier reaching US$557.92, the highest since January 22, 1981. Prices are up 3 percent for the week and 31 percent in the past year.


Gold's rise today "is triggered by the funds," James Moore, a precious metals analyst with, said in an interview today. "They're buying because they want to diversify their portfolios."

Because the New York market will be closed on January 16 for a national holiday, "Some investors just want to buy gold before going into the long weekend as there is also increased concern over Iran and avian flu," Moore said.

U.S. President George W. Bush on Friday urged a diplomatic solution to the standoff with Iran over its nuclear ambitions, saying the United Nations Security Council should deal with the issue.

The World Health Organization said today that the H5N1 bird flu strain that has infected at least 18 people in Turkey may be a more contagious variant of the deadly virus found in Asia, which has led to the destruction of millions of birds and 78 human deaths.

Gold may average US$544 an ounce this year, 22 percent more than the average in 2005, and may peak around US$620, Panizzutti said.

Updated : 2021-07-31 11:58 GMT+08:00