The price of gold has climbed to a record high, reaching $1,943.93 (£1,513) an ounce, as investors ploughed their money into the precious metal amid fears about the impact of the coronavirus pandemic on the global economy and the worsening US-China trade row.

The spot gold price rose 2.2% on Monday morning, overtaking its previous record from the financial crisis in September 2011, adding to the previous week’s gains.

Gold has long been viewed as a “safe haven” asset, a secure place for investors to put their money when other investments are volatile and a way of hedging against falls in assets such as stocks or currencies.

Economies around the world are struggling to reopen following coronavirus lockdowns, and the threat of a large global recession looms.

The US dollar has been sliding in recent weeks and fell to its lowest level in a yearas concerns have increased about the American recovery and the intensification of the trade row between the world’s two largest economies.

Gold is seen as “insurance from turbulence on currencies markets”, said Carlo Alberto De Casa, the chief analyst at online trading platform ActivTrades. “While currencies can all be printed, the finite nature of gold and silver makes them better stores of value at these times of uncertainty,” he said.

The latest rise in gold came as Chinese authorities took over the US consulate in the city of Chengdu. China had ordered the closure in response to Washington’s order for the Chinese consulate in Houston to be shut.

The price of gold is expected to rise further because of geopolitical tensions, said Mark Haefele, the chief investment officer at UBS Global Wealth Management.

“In our view the primary drivers of the gold price are its negative correlation to real interest rates and the dollar. We think these factors, in combination with limited supply growth as miners continue to restrain capital spending, will drive gold prices higher,” Haefele said.

Analysts forecast that gold could reach $2,000 an ounce for the first time, as the dollar is expected to remain under pressure before the upcoming US Federal Reserve meeting, where central bankers could decide to keep interest rates low for longer.

The price of silver has rallied along with the gold price, rising by more than 6% to $24.36, reaching its highest level since September 2013.

Large investors, such as private banks, have been buying gold, along with individual investors who moved money into the metal in growing numbers during the first six months of the year.