Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Gold tops $1,500 for first time

Gold prices on the rise.Click chart to track the price of gold. By Charles Riley, staff reporter


NEW YORK (CNNMoney) -- Gold prices topped a record $1,500 for the first time ever on Tuesday, shattering an important psychological barrier as investors seek out investments thought to be safe during times of upheaval.

Many investors see gold as the best place to park their money when there's economic or political uncertainty, and there has been plenty of that to go around.

The price spike also comes against the backdrop of market uncertainty that has sent investors looking for an alternative to the weak U.S. dollar. And gold has been the marquee beneficiary.

On Monday, it was a dour outlook on U.S. debt that sent gold prices higher.

Standard & Poor's lowered its outlook for America's long-term debt to "negative" from "stable," based on uncertainty surrounding the nation's fiscal problems.

That's exactly the type of news that creates a flight to safe haven assets like gold.

Gold futures for June delivery hit an intraday record of $1,500.50 an ounce near midday, before retreating to settle at $1,495.10 an ounce -- also a new record.

The price of gold has tracked steadily higher in recent months, as a cavalcade of unsettling world events created uncertainty in global markets.

Since the start of the year, investors have been forced to consider the implications of a Japanese tsunami, earthquake and nuclear disaster. That's in addition to a spike in crude prices and a slew of revolts in the Middle East and North Africa.

Inflation -- which gold is often used to hedge against -- has been rising sharply in emerging economies and is becoming more of an issue in Europe.

Carlos Sanchez, director of commodities management at New York-based CPM Group, said prices could go as high as $1,550 in the next couple weeks as investors focus on political gridlock in Washington.

The next major event for the gold market is the May deadline for the government to raise the debt ceiling, Sanchez said.

On Tuesday, silver prices were also on the rise. The understudy commodity settled at $43.75 an ounce -- its highest level in three decades.

Of course, the records this week are not adjusted for inflation. Gold rose to $825.50 per ounce on Jan. 21, 1980, which is $2,211.65 in today's dollars, according to the Minneapolis Fed Calculator. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed4.02%4.10%
15 yr fixed3.18%3.25%
5/1 ARM3.19%3.30%
30 yr refi4.02%4.11%
15 yr refi3.20%3.26%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 20,656.58 -4.72 -0.02%
Nasdaq 5,817.69 -3.95 -0.07%
S&P 500 2,345.96 -2.49 -0.11%
Treasuries 2.42 0.02 0.92%
Data as of 12:53am ET
Company Price Change % Change
Bank of America Corp... 23.07 0.13 0.57%
Ford Motor Co 11.67 -0.10 -0.85%
Micron Technology In... 26.47 0.41 1.57%
Advanced Micro Devic... 13.79 0.00 0.00%
Chesapeake Energy Co... 5.09 0.09 1.80%
Data as of Mar 23

Sections

Mexican foreign minister Luis Videgaray said if trade talks don't result in a good agreement for his country, "Mexico will step away from NAFTA." More

The Federal Communications Commission voted Thursday to approve a proposed rule that would make it easier for phone companies to crack down on robocalls. More

Your credit score plays a major role in your personal finances. The better the score, the better it is for your wallet. Here's how to help get it above the 800 mark. More