Gold price soars to new 27-year high after as Fed prints more money

Standing left to right – Mr. Dinesh Jebamani (Chief Manager Liability Product Management and New Age Media – Seylan Bank), Mr.Sudesh Peiris (Senior Manager – Digital Banking Channels – Seylan Bank), Ms. S.Senevirathne (Representative of the Revenue Department – Western Province), Mr. Tilan Wijeyesekera (Deputy General Manager – Retail Banking – Seylan Bank) and Mr. Malik Wickremanayaka (Deputy General Manager – Operations – Seylan Bank)

LONDON, Sept 28, 2007 (AFP) – The price of gold surged Friday to the highest level since January 1980 as the precious metal was boosted by the sliding US dollar. On the London Bullion Market, gold prices leapt as high as 739.90 dollars per ounce.

Analysts said that gold is winning support from the weak US currency, which makes dollar-denominated commodities cheaper for investors using other currencies.

The metal is also boosted by record crude oil prices, which spark fears over inflation.

Gold is seen as a store of value and a hedge against inflation. The dollar has plunged to a series of record lows against the euro over the past week, venturing deeper into uncharted territory after recent soft US economic data and a deep interest rate cut from the Federal Reserve.