This is the first time in its 100+ year history that the London price of gold has exceeded $2,000 per troy ounce.
The new record price continues gold’s rapid rise through 2020. The metal price opened the year on 2 January at $1,520.55 and has gained 33.8% in the 149 trading days to date, breaching $1,900, for the first time on 24 July. Previous milestones were passed on 14 March 2008 ($1,000) and 20 April 2011 ($1,500). In all, the price of gold has risen some 621%, in the 20 years of this century.
“I can think of no clearer demonstration of gold’s role as a store of value than the enthusiasm with which investors across the world have turned to the metal during the unique social and economic turmoil of the past few months,” said Ruth Crowell, CEO, LBMA. “Gold has once again proved to be the safe-haven of choice in periods of uncertainty and high volatility.”
The first London gold price auction, now known as the LBMA Gold Price, took place on September 12, 1919. Today, the LBMA Gold Price continues to be set in London and remains the international benchmark price for the gold market. Over the years, it has evolved and modernised. One of the most significant changes came on 1 April 1968 when the price changed from UK Sterling to US Dollars and moved to twice a day, to reflect the growth in the US market.
On 20 March 2015, LBMA announced that ICE Benchmark Administration (IBA) were appointed as new independent administrators of the gold price auction process. IBA have also established an external oversight committee to assist them in ensuring the effective governance of what is a transparent, trusted and tradable auction process.
Since 2015 the number of direct price participants has increased from 5 to 15, and now includes three Chinese banks. The number and global reach continues to grow.
London traded gold volume has been exceptional in the past few days, setting a record high on 30 July, when 89.36 mn oz changed hands to a value of some $174 bn, over 50% higher in value terms than the previous record.
Through 2020, London traded gold volume has averaged at $62.7 bn per day. During the five trading days to 3 August (the latest figures available) volume was 251.1 mn oz (50.2 mn oz per day), with the value traded $490.3 bn ($98 bn per day).