Paulson loses $1bn in gold price slump

City A.M. Reporter
THE COLLAPSE in the price of gold this week has cost hedge fund titan John Paulson as much as $1bn (£650m) of his own money.

The 13 per cent slump in gold since Friday has dragged the metal to a two-year low and hammered Paulson’s personal wealth. He started the year with 85 per cent of his own hedge fund investments in gold class shares, believing the position to be a good hedge against inflation, according to Bloomberg.

Spot gold initially dropped further still yesterday, to $1,321.35 an ounce, before reversing direction to gain 1.5 per cent to $1,372.90.

Oil, meanwhile hit its lowest price in nine months yesterday. Brent crude was down 72 cents to $99.91 a barrel, the first time the fuel has dipped below $100 since July.

Trading volumes were around 50 per cent ahead of the 30-day average in the US.

The decline followed a three per cent drop on Monday, part of a wider commodities rout after data showed economic growth in China, the world’s second-largest oil consumer, had slowed unexpectedly in the first three months of 2013.