Gold gains luster as US-China trade war dims global outlook

Central banks and ETFs snap up the metal amid negative interest rates

Central banks are on pace to buy more gold this year than last year, when they bought the most since the U.S. ended dollar convertibility in 1971.

RYUTA MINAMIHATA and KAZUYA MANABE, Nikkei staff writers

November 3, 2019 02:04 JST

TOKYO -- Gold prices are surging, with central banks and gold-backed exchange-traded funds buying up the precious metal amid uncertainty stemming from the prolonged U.S.-China trade war and negative interest rates around the world.

Gold futures in New York are trending around $1,500 per troy ounce -- approximately $200, or 15%, above the theoretical value of $1,300. The difference is the largest since 2011, when gold prices were buoyed by the downgrading of U.S. sovereign debt.