08/08/2011 09:21 EDT | Updated 10/08/2011 05:12 EDT

Gold Prices Top US$1,700 Per Ounce In Wake Of U.S. Debt Downgrade

Flickr: BullionVault

NEW YORK, N.Y. - The price of gold is streaking past $1,700 an ounce for the first time.

Investors, beset by worries about the U.S. debt downgrade, Europe's financial crisis and slowing global growth, are seeking safety in the metal.

Standard & Poor's on Friday cut the long-term credit rating for the U.S. by one notch to AA+ from AAA, deepening investor fears about a weakening U.S. economy. A debt crisis in Europe threatens to destabilize financial markets. Stocks are tumbling around the globe Monday.

Gold has shot up more than 3 per cent, or $51.70 per ounce to $1,703.50, in Monday morning trading. It has nearly doubled in price since the start of 2009.

Still, adjusted for inflation, an ounce of gold remains below its 1980 peak of $850, or $2,400 at current levels.