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Gold surges to record high on new fears for the economy

Photo of gold bars. (Provided Photo/AP)

 (CNN) — Gold prices have soared to a record high as investors rush to find safe places to park their money as concerns grow about a resurgence in the coronavirus and the impact that could have on the global economy.

Gold hit $1,944 per ounce earlier on Monday, beating its previous record of $1,921 set in 2011.

“Gold is the clear beneficiary of safe haven demand,” Stephen Innes, chief global markets strategist at AxiCorp, said in a research note.

The main driver behind gold’s rally has been falling returns on US government bonds, which reflect the likelihood that the Federal Reserve will have to keep interest rates lower for a prolonged period of time to support the economic recovery, according to Hussein Sayed, chief market strategist at FXTM.

That has also served to weaken the US dollar, which is trading at a 22-month low of 0.85 euros and a 4-month low against the Japanese yen, Sayed said in a research note Monday.

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