Gold soared to its highest in more than six years this morning as investors sought insurance against financial strife ahead of a speech by the US Secretary of State Colin Powell, a possible harbinger of war against Iraq.
Hours before Mr Powell tries to convince the UN Security Council that Baghdad is hiding banned weapons of mass destruction, gold was at peaks not seen since September 1996.
Gold was set or "fixed" in the London morning session at $385.00 a troy ounce, its firmest point since September 9th, 1996 and up from the previous fix of $376.55.
That sent silver prices darting to six-month highs, while shares in gold producers jumped and prospectors in Australia made a run on heavy mining equipment.
Spot gold traded as high as $388.50 an ounce as investors piled into a metal seen as a sure bet in troubled times.
Bullion has gained more than 13 per cent since the start of the year, bolstered by fears of a US-led attack on Iraq, jitters over North Korea's nuclear ambitions and weakness in the dollar.