Gold tops $500, can’t hang on

The price of gold briefly crept over the $500(US)-per-oz mark in London last week, representing the first time since February, 1983, the precious metal has topped that price level.

The morning fix in London was quoted at $502.75, but by the afternoon the fix had slipped to $499.75. A worsening U.S. trade deficit and a falling dollar were pinpointed as the main reasons for the price surge.

Since then the gold price has tumbled and at presstime was trading just above the $490 mark. This time a decline in the price of a barrel of oil — to below $17 — on the futures markets was said to have added to the general confusion being experienced by investors who are uncertain as to which way the economy is headed.

The gold price has been volatile this year, especially in this last quarter during which the yellow metal has traded in a price range of about $40. During the first nine months of 1987, gold averaged $437.