Gold hits new high on weak dollar

Demand for gold increases in the run-up to Christmas

The price of gold has touched a new all-time high as the precious metal becomes increasingly attractive compared with the weakening dollar.

Gold rose by almost $12 to hit $1,107.2 an ounce, compared with $1,095.7 at the previous close.

Growing demand from emerging markets, particularly in Asia, is also helping to drive the price of gold.

Gold and other commodity prices have surged recently as investors have moved away from the US dollar.

The dollar has fallen by 13% against the pound this year, and by 7% against the euro.

"The dollar will continue to have a very big impact on metals and gold", said Afshin Nabavi at gold bullion refiner MKS Finance.

Increased demand among emerging market governments looking to diversify their foreign exchange holdings has also pushed the price of gold higher.

There is also higher demand from individuals. The price of gold is typically strong in the October-to-December period because of the higher demand for jewellery in the run-up to Christmas and the Indian festival of Diwali.

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