The London Daily News

News Desk

Investors around the world are buying gold at record levels pushing up gold prices to a record $1,251.20 or £861 an ounce on Tuesday after investors ditched the euro because of the debt crisis in Europe and uncertainties over the future of U.S. interest rates.

 In London gold sovereigns produced in the early part of the 1900's are in short supply with analysts not prepared to say that gold has yet to hit its peak price.

The news of gold surging is not surprising with a weaker global economy, especially in debt-ravaged Europe, is the necessary ingredient for the gold safe haven and a parallel weakening of industrial metals.

What is remarkable is that gold hit a record not only in US dollars, but in several other currencies: the euro, the Swiss franc, the pound, the rupee (important given India's demand for jewellery), the rand and the yuan.

The latest surge is being put down to increasing fears of a euro-zone meltdown. The latest surge was triggered by a warning from Fitch Ratings that Britain faced formidable economic problems.

There are reports that British bullion dealers are struggling to get their hands on enough gold sovereigns and Britannia coins to meet demand.

Increasingly gold "junk buyers" are arranging from individuals to sell jewellery for cash, so that the gold can be sold to be smelted to make bars or coins.

Gold Coin