Gold barreled above $800 an ounce Wednesday for the first time since 1980 as investors cheered the Federal Reserve’s decision to lower its benchmark interest rate by a quarter point. The Fed lowered its federal funds rate to 4.50 percent, as the markets widely anticipated. Lower interest rates tend to undermine the dollar and raise the allure of precious metals as an investment alternative. The dollar stumbled to another low against the euro ahead of the Fed’s decision on Wednesday, helping drive gold higher.
Gold last topped $800 an ounce in 1980, when prices reached as high as $875 an ounce in January. Adjusted for inflation, an $800 ounce of gold in 1980 would be worth more than $2,000 today.