Gold rose to a 24-year high in Asia as fund managers added the precious metal to their portfolios and as Japanese traders increased buying.
The overseas markets remained bullish since October and jumped 14 per cent, as investors bought bullion as a hedge against inflation and as an alternative to under performing stocks and forex markets.
Gold for immediate delivery rose $8.15 to $534.55 an ounce, highest since March 1981 and for February contract $7.50 at 537.70, highest since April 1981. The metal has risen on 13 out of the last 16 days.
Russia's central bank had said it might double its gold reserves. Central banks in South Africa and Argentina also said they may increase holdings of gold.
Buying by Japanese arbitrageurs, who take advantage of price gaps between the cash market and gold futures on the Tokyo Commodity Exchange, also lifted prices.
The white metal also picked up smartly on brisk buying by local parties as most of the speculators and stockists were completely busy trading in gold.
Silver ready shot up by Rs 300 to a new high peak of Rs 13,650 per kilo and weekly-based delivery by Rs 285 at Rs 13,785 per kilo. Silver coins were unaltered at Rs 17,500 for buying and Rs 17,600 for selling of 100 pieces.
Standard gold and ornaments shot up by Rs 175 each at Rs 8,150 and Rs 8,000 per ten gram respectively. Sovereign was also higher by Rs 50 at Rs 6,100 per piece of eight gram.
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