Gold prices surge as Germany's Covid-19 R number spikes

Gold is viewed by many as a hedge against negative yields, devaluation of currencies, an unexpected surge in inflation or deflation, poor economic performance and shocks in equity markets. Nevertheless many investors try to avoid it as it pays no interest.

Gold prices have risen 15% this year amid fears of a coronavirus-induced economic slowdown and unprecedented stimulus measures from governments and central banks globally.

Connor Campbell, at Spreadex, said: "Seemingly joined at the hip, at least this Monday, gold rose as Germany’s R rate crept past the crucial 1 level, people’s fears of a second wave emerging in Europe – as it seems to have done in China and the United States – causing them to flee to safer havens."