Last Friday, gold surged to a new record of $923.73 an ounce (then $944 on Tuesday). The rise was put down to production problems in the world's second-largest producer, South Africa, which closed down precious metals mines following the government's announcement of a "national electricity emergency".
But gold's rise is down to much more than temporary power cuts in South Africa. Both institutional and private investors around the world have been seeking exposure to the metal, seeing gold as a safe haven as trouble piles up for the ailing US economy. And the Federal Reserve's latest panicky attempts to boost the stock market have sent demand even higher. The Fed's willingness to cut interest rates at the first signs of market panic, says one thing loud and clear it doesn't care about inflation.
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