Gold prices hit record highs this week, amid fresh turmoil in financial markets, as investors rushed to stock up on the precious metal.

Gold prices have surged more than 30 per cent in euro terms since the beginning of the year on the back of investor buying and the euro’s weakness against the dollar. German and Swiss investors snapped up gold coins this week after the €750bn eurozone bail-out was announced.

On Friday, gold traded as high as €1,002.69 an ounce. In dollars, spot gold in London surged to a fresh nominal all-time high of $1,248.95 a troy ounce, up 1.4 per cent on the day. But, adjusted for inflation, gold prices are a long way from their real all-time high of more than $2,300 per ounce achieved in 1980.

Rupert Robinson, chief executive of Schroders Private Bank, says that about 8 to 10 per cent of his clients’ portfolios are invested in gold and
gold stocks.

“I think that in the long-term, gold is a good asset to hang on to,” Robinson concludes. “It could easily reach $2,000 per ounce within the next five years.”

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