Gold prices broke another record Thursday on renewed worries that the U.S. economy could be running the risk of facing stagflation for the first time since the 1970s.
Benchmark contracts for bullion were tacking on $8.40 at $946.20 an ounce in recent action on the Comex division of the New York Mercantile Exchange. Earlier in the session, the price hit $952, its highest level ever. Gold started the year around $840.
The exchange-traded funds that hold bars of bullion in secure vaults,
streetTracks Gold Shares
iShares Comex Gold Trust
, were expected to open the session higher, in line with the metal's price.
"The whole bond-insurance issue, and the talk of stagflation is making investors flock to gold," says Andy Montano, director of precious metals at Toronto-based bullion bank ScotiaMocatta.
Stagflation occurs when consumer price inflation rises at an uncomfortably high level while at the same time the economy grows at a subpar rate. Given those concerns, some investors are choosing to invest in gold as a safe-haven asset.
In the precious metals patch,
reported a fourth-quarter loss of $289 million, or 63 cents a share. The results include a $1.1 billion write-down of exploration goodwill and a gain of $597 million from the sale of certain assets. The firm made $223 million in the same period a year earlier.
Losses from continuing operations totaled $933 million for the quarter, down from earnings of $171 million in the same period the prior year.
Shares of Newmont were slipping 1.3% to around $50 in recent premarket activity.