How will the US debt ceiling crisis impact on gold?

Q&A - US DEBT CRISIS

Bradley George, co-portfolio manager of the Investec Global Gold fund, discusses the impact of the US crisis on gold as the deadline for increasing the debt ceiling approaches.

• What is the relationship between the US dollar and gold prices? As the world's supreme hard asset for centuries, logically, gold is inversely correlated with the world's supreme paper asset, the US dollar (the world’s reserve currency). This relationship, however, is not perfect and there have been times when investors have turned to both gold and the US dollar simultaneously in their search for safe haven assets. In the long run, however, we expect the USD/gold inverse relationship to hold; this should be the case for as long as the USD is the world's principal reserve currency....