Just how high could gold go?

Just how high the price of gold could go is a tough call to make. Because as more people become interested in the stuff, the more bizarre valuation methods we'll see.

Fears over the euro have sent gold spiking to new highs. But just how high could it go eventually? I've read a lot of interesting calculations recently. On Breakingviews, Martin Hutchinson suggests it could hit $5,000 an ounce or more. Based on consumer price inflation, he says, the $875 an ounce high seen in 1980 is equivalent to $2,400 an ounce today. But if you also consider the huge growth in the world's economic output since then (it's increased about six-fold), and "the gold price could top out at $5,300," says Hutchinson.

Meanwhile, our own Tim Price told readers of his Price Report newsletter last week that you could argue that gold was worth $9,500 an ounce. How? Take it away Tim

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
Explore More
John Stepek

John Stepek is a senior reporter at Bloomberg News and a former editor of MoneyWeek magazine. He graduated from Strathclyde University with a degree in psychology in 1996 and has always been fascinated by the gap between the way the market works in theory and the way it works in practice, and by how our deep-rooted instincts work against our best interests as investors.

He started out in journalism by writing articles about the specific business challenges facing family firms. In 2003, he took a job on the finance desk of Teletext, where he spent two years covering the markets and breaking financial news.

His work has been published in Families in Business, Shares magazine, Spear's Magazine, The Sunday Times, and The Spectator among others. He has also appeared as an expert commentator on BBC Radio 4's Today programme, BBC Radio Scotland, Newsnight, Daily Politics and Bloomberg. His first book, on contrarian investing, The Sceptical Investor, was released in March 2019. You can follow John on Twitter at @john_stepek.