Gold price rises by $50

Those who began singing the swan song for gold around four weeks ago are doubtless rubbing their eyes in amazement now, for gold has meanwhile gained by nearly $100 as compared with its end of July 5½-year low. Gold has risen by $50 over the past three days of trading alone and this morning has reached just shy of $1,170 per troy ounce.

It would appear that the yellow precious metal is not quite so useless after all when things get turbulent on the markets. After all, equity markets are now nose-diving not only in China but worldwide, US equity indices recorded their sharpest daily falls in 18 months yesterday, the Dow Jones Industrial Average closing at its lowest level in 10 months. 

The equity markets in Asia have likewise dropped significantly today following the announcement that the Chinese Purchasing Managers' Index had fallen to a 6½-year low. The DAX has already shed more than 5% this week alone and is trading at its lowest level since January, so it is no surprise that investors are rediscovering gold as a safe haven, says Commerzbank.