Gold and platinum set historic highs in choppy trade on Thursday, with strong oil prices, a struggling dollar and supply worries boosting investor interest.
Silver hit a 27-year high above $18 an ounce, a spike of 22 percent this year, while palladium jumped more than 9 percent to a 6-1/2-year high before paring gains.
The outlook for gold remains positive given the expectations for continued dollar weakness, further Fed rate cuts and inflationary and macroeconomic concerns, Suki Cooper, precious metals analyst at Barclays Capital, said.
Although speculative length remains elevated, we would expect further safe-haven buying to buoy prices, she said.
Spot gold hit a high of $948.60 an ounce and was quoted at $944.70/945.50 at 10:05 a.m. EST, against $934.80/935.60 late in New York on Wednesday.
Oil prices fell, but traded not far from this week's record highs above $100 a barrel.
Gold is generally seen as a hedge against oil-led inflation. It often moves in the opposite direction of the dollar, as a weaker currency makes gold cheaper for other currency holders.
The dollar slipped, weighed down by minutes from the Federal Reserve's January policy meeting, which affirmed expectations of further U.S. interest rate cuts.
Markets have priced in the risk of another half percentage point rate cut at the Fed's March meeting, which would further erode the dollar's appeal to global investors.
At the moment, it appears to be investor demand which is the real driving force behind it. And that is influenced by things such as a weak dollar, risk aversion and inflationary fears, said Daniel Hynes, metals strategist at Merrill Lynch.
There is a real possibility of a spike above $1,000 an ounce, although I am not convinced at this stage about its longevity above that price, he said referring to gold prices.
U.S. gold futures hit a record high, with the April contract rising to $952.40 an ounce before falling to $948.
Analysts said there were several reasons to be bullish.
There is no single reason why investors hold gold. Some fear a dollar crash, others buy gold for a liquid way of playing the commodity cycle, others will have bought it on momentum, said John Reade, metals analyst at UBS Investment Bank.
But yesterday's move shows another reason. We believe that many investors have bought and held gold because of fears of stagflation, coupled perhaps with worries about financial system risk, he said in a client note.
In other metals, platinum hit a record high of $2,182 an ounce and was last at $2,163/2,173, against $2,120/2,130 in New York on Wednesday, when it fell 3.5 percent to $2,065.
Clearly any weakness in the price is pounced on quickly by investors as there are plenty waiting on the sidelines to enter into the market, Hynes of Merrill Lynch said.
Platinum has jumped 40 percent this year after mines in South Africa, accounting for 80 percent of world output, were shut for five days at the height of last month's power crisis.
South African power utility Eskom said it had contracted 30 million tonnes coal of the 45 million tonnes it needs over the next two years to help resolve a crippling power crisis.
Palladium rose as high as $525 an ounce, tracking strong platinum prices. It was last quoted at $516/521, against $481/484 in New York. Silver hit a high of $18.02 before falling to $17.90/17.95, against $17.76/17.81 on Wednesday.
(Editing by Michael Roddy)