Gold Climbs to All-Time High, Topping 2011 Record

By Amrith Ramkumar and Joe Wallace

Gold prices rose to a new closing record for the first time since 2011, extending a summer surge fueled by nervous investors adding bullion to their portfolios as the coronavirus muddies the global economic outlook.

Most actively traded gold futures rallied 0.4% to $1,897.50 a troy ounce, climbing for the sixth consecutive session and eclipsing their August 2011 peak of $1,891.90. Gold came close to topping the high on Thursday and has risen steadily since the end of 2018, spurred by trade tensions and the pandemic pushing investors toward safer assets.

The coronavirus has ignited a global gold rush, with physical traders around the world trying to get their hands on more metal and individuals around the world ordering bars and coins. Even as stocks rally, many investors remain nervous about the pandemic and a host of geopolitical concerns ranging from the relationship between the U.S. and China to November's U.S. presidential election.

"It's a special time for precious metals where every factor seems to be moving in their favor," said Tai Wong, head of base and precious-metals derivatives trading at Bank of Montreal. "The market is uniformly bullish." He has been a metals trader for about 15 years and only remembers this much excitement in the sector following the financial crisis.

Investors have also been bidding up shares of gold miners such as Newmont Corp. and Barrick Gold Corp. And the price of silver -- gold's precious metal peer -- on Wednesday hit a nearly seven-year high above $23 a troy ounce, though it fell Thursday and Friday.

Expectations for the world's central banks and governments to continue flooding the global economy with cash are also lifting demand for bullion. Ultralow interest rates make gold more appealing because the metal offers no income simply from holding it. Many analysts also expect historic stimulus measures to eventually spur inflation, eroding the purchasing power of paper money and boosting the value of precious metals.

European Union leaders recently reached an agreement on more than $2 trillion in spending, and traders anticipate U.S. lawmakers will soon approve additional coronavirus aid.

Many big-name investors including Ray Dalio, Jeffrey Gundlach and Paul Tudor Jones have touted the benefits of owning the metal in recent months, with the pandemic stinging business activity and a global pile of debt expanding.

Write to Amrith Ramkumar at [e-mail] and Joe Wallace at [e-mail]