Continuing their spectacular rally, gold futures scaled a fresh high of Rs 28,347 per 10 grams today as speculators engaged in creating huge positions, tracking a firming global trend as the economic slowdown and European debt crisis boosted demand for a safe haven.
In addition, the weaker rupee and diversion of funds from melting equity markets supported the upward spiral in gold prices.
At the Multi Commodity Exchange, December gold surged by Rs 1,408, or 0.22%, to hit another high of Rs 28,347 per 10 grams, with a business turnover of 279 lots.
October delivery rose by Rs 70, or 0.18%, to Rs 28,024 per 10 grams, with a business turnover of 5,990 lots.
Analysts attributed the persistent rise in gold futures prices to speculative positions created by participants, bolstered by a rally overseas amid fears of another US recession and contagion of the euro zone debt crisis, which raised demand for bullion as a safe haven.
The falling value of the rupee, which plays a major role in determining the landed cost of the dollar-quoted shiny metal, also influenced prices, they said.
The rupee depreciated by 28 paise today to trade at Rs 46.02 in the forex market, a level last seen on November 30 last year.
Meanwhile, gold climbed by a record $25.90 to $1,879 an ounce in the Asian region today.