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December 2, 2009    

Gold continues to soar on back of weak dollar

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by Kay Murchie
Gold continues to soar on back of weak dollar

The price of gold continues to surge to record highs and has touched $1,201.63 an ounce on the London Bullion Market as the US dollar continues to be a turn off for investors.

The rise of the price of gold over recent weeks has been attributed to a weakening US dollar, which typically moves in the opposite direction to the precious metal.

There are ongoing concerns about the weakening dollar after the Federal Reserve said US interest rates will remain low.

Increasing demand from emerging markets has been pushing up the price of the precious metal over recent weeks.

Furthermore, gold traditionally rises during the October to December period as the run-up to Christmas and the Indian festival of Diwali boosts demand.

The price of gold is also on the up after the purchase of International Monetary Fund gold by Sri Lanka’s central bank last week.

Meanwhile, the US dollar fell yesterday on the back of weak and economic uncertainty, as a result of the Dubai debt crisis, which is also having a devastating affect on global stock markets.

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