Gold is outperforming other asset classes and could be set for fresh highs later in the year on a combination of recovering oil prices, rising inflation and a weakening dollar, according to analysts at Barclays Capital.
Precious metals are increasingly diverging from other commodities, they said.
Fears over the outlook for the global economy and the stability of the financial system have fuelled buying of gold at the same time as they have knocked the value of other assets.
"Precious metals are not only the best performing commodity sector by a substantial margin but also the best performing asset overall, with stocks and property down sharply year-to-date," said Barclays.
