Gold futures rose to a record $1,681.70 an ounce as turmoil in financial markets boosted demand for the precious metal as an investment haven. The MSCI World (MXWO) Index of equities has dropped 11 percent from this year’s May peak. The yen tumbled the most since 2008 versus the dollar as Japan intervened to drive down its currency. The euro fell against the greenback as the European Central Bank offered banks additional cash amid the debt crisis. Treasury two-year note yields approached a record low. “The geopolitical backdrop is inherently bullish for gold,” Matthew Zeman, a strategist at Kingsview Financial in Chicago, said in a telephone interview. “As risk appetite wanes, people have been piling into gold and Treasuries. Yields are so low that the only alternative is gold.” Gold futures for December delivery rose $14.30, or 0.9 percent, to $1,680.60 at 9:27 a.m. on the Comex in New York. The price reached an all-time high for the third straight day. To contact the reporter on this story: Pham-Duy Nguyen in Seattle at pnguyen@bloomberg.net To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net

Source