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The price of gold has hit another record high as investors turn to the safe haven asset amid a tightening US presidential race and intensifying conflict in the Middle East.

Gold rose to a record £2,097.67 ($2,732.73) per ounce, having gained almost 40 per cent in the last 12 months and 83 per cent in the last five years.

The precious metal is prized for its use in jewellery and because of its indestructible nature since it does not rust or react. It is also seen as a safe haven asset for investors in times of strife, albeit not a long-term one since unlike shares in companies or property it offers no income.

It has enjoyed renewed popularity in some online circles, as influencers who have been burned by meme stocks and cryptocurrencies seek a more dependable asset.

But in the long term it is considered a less attractive investment since it is prone to volatile and often unexplainable price movements based on sentiment.

Russ Mould, investment director at AJ Bell, the stockbroker, said views on gold depend on what “camp” investors are in, with those following the orthodoxy of billionaire investor Warren Buffett considering it an inert lump of metal with few industrial uses.

The other camp sees it as a dependable currency with a very long history and a limited supply – something useful in the face of currencies eroding in value.

The US, the world’s biggest economy, is expected to pay an additional $1.1 trillion in interest on its government debt in the next 10 years. This could mean interest costs soon surpass defence. Such huge interest payments have perhaps caught the attention of investors with an eye on inflation and who may be questioning the control central banks have on currencies.

If central bankers “have to make a choice between inflation and growth they may take their chances a little with inflation,” Mr Mould said, which again makes gold attractive as the value of money declines.

Other factors could include the US election, with the polls tightening with less than three weeks to go, and no sign of any respite in the hostilities in Ukraine and in the Middle East.

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