The price of gold has touched $1300 an ounce for the first time, briefly reaching $1300.07 before dipping back. The latest rise has been caused by caution over the global economy as well as weakness in the US dollar.

The US dollar, the currency used to value gold, yesterday fell 1% against the euro. A fall in the dollar makes it cheaper to buy gold for buyers using other currencies. Gold has traditionally been seen as a safe house safe haven for investment in times of economic uncertainty and the price of gold often arises when people are nervous.

In the last 10 years the price of gold has increased 500%, up from a low off $258 an ounce in 2000. Knowledgeable analysts believe they are compelling reasons for the price of gold to keep climbing.

The World Gold Council’s latest report on the gold market predicted that prices would be kept high because of the continuing strong demand from the jewellrey buyers in the fast developing markets of China and India.

David Beahm, vice president of economic research with New Orleans based Blanchard & Company Inc, said “For gold prices to not keep going up, the economy would have to improve to the point where the Fed felt it didn’t need to print money, the dollar would have to strengthen and the problems in Europe would have to end. We don’t see that happening,”