LONDON (SHARECAST) - The gold price hit a record intra-day high on Friday before profit takers moved in at the death to ensure the precious metal ended the week lower than it started it for the first time in five weeks.
Gold for August delivery hit a new high of $1,259.50 before receding to close at $1,256.20, up $10.30 on the day.
Demand for gold peaked after US gross domestic product (GDP) figures for the first quarter were revised downwards. The Commerce Department’s new data indicated an annualised growth rate for GDP of 2.7%, the second downward revision of the growth rate; the initial estimate was for 3.2% annualised growth but that was revised down to 3.0% last month.
Traders raced to close positions ahead of the meeting of the G20 meeting in Canada over the week-end for fear that the G20 leaders would announce a new round of belt tightening that might diminish the yellow stuff’s appeal as a haven investment.
As is often the case, as gold dipped so oil rose, with crude for August delivery closing in New York at $78.86 a barrel, up $2.35 on the day.
Demand was driven by investors seeking to increase exposure to the black stuff before the hurricane season gets into full swing.
There were fears that Tropical Storm Alex would head for the Gulf of Mexico where oil company BP is attempting to clean up after an oil spill.
