US banking crisis pushes gold close to all-time high

Gold is closing in on an all-time high as resurgent Chinese demand and fears over the health of regional US banks have added further fuel to the six-month rally in the precious metal. Consumers in China rushed to buy more jewellery, bars and coins in the first three months of the year after Beijing lifted its zero-Covid policies, according to the World Gold Council, an industry body, while the failure of three regional US banks has also prompted investors to turn to the yellow metal, which acts as a store of value in times of uncertainty.

The latest leg of a banking crisis, in which regional US bank PacWest said it was exploring a potential sale to secure its future, pushed trading in gold futures on the Comex exchange to match its all-time high of $2,072 on Thursday. The spot gold price came within cents of its all-time high of $2,072.49 on the same day, according to Refinitiv. It fell back slightly to $2,008 on Friday, after better than expected US jobs data raised the possibility that the Federal Reserve might have to lift interest rates further to tame inflation.