Gold jumps back above £3,000 an ounce as the dollar slides after US midterms

Gold climbed sharply on Wednesday, with spot trading near $4,066 a troy ounce late in the session, up about 3.5 per cent, according to Kitco's PM report. That is roughly £3,078 an ounce, or £99 a gram, on our approximate conversion before any dealer costs. It puts gold back above the $4,000 level and recovers much of the ground lost in October.

The move followed the US midterm elections, in which Democrats took control of Congress. Kitco reports that the dollar weakened and the 10-year US Treasury yield fell to about 4.89 per cent, its lowest in nearly two months. A weaker dollar makes gold cheaper for overseas buyers, and lower yields reduce the appeal of assets that pay interest.

The rally may be fragile. Kitco notes the election result does not directly change Federal Reserve policy, and markets still see roughly an 80 per cent chance of a US rate rise in December, which usually weighs on gold. Kitco research also found gold higher a year after eight of the last 13 midterms, but cautions that 13 cases is too few to rely on.

For UK buyers, investment gold coins and bars are free of VAT, so the real price is spot plus dealer premium plus delivery. Compare that all-in total rather than reacting to a single day's jump. This is market information, not financial advice.