Gold Hits Record High

Gold hit record highs for a fourth day on Monday as speculation the Federal Reserve may announce further moves to stimulate the U.S. economy after its policy meeting this week piqued interest in the precious metal.

Spot gold hit a record $1,283.25 an ounce and was bid at $1,281.20 an ounce at 1429 GMT (10:29 a.m. EDT), against $1,275.95 late in New York on Friday. U.S. gold futures for December delivery rose $5.40 percent to $1,282.90 an ounce.

Concern over U.S. economic growth has sparked talk that the Fed may signal a move toward further quantitative easing, which could potentially prove inflationary.

It has also raised expectations that interest rates will stay low, undermining the dollar and cutting the opportunity cost of holding non-interest bearing gold.

"All the stories stack up hugely in favor of gold currently," said Saxo Bank senior manager Ole Hansen. "A move higher to between $1,300-1,350 could be a good target toward year-end, but it will come in steps."

The precious metal is likely to consolidate for the time being, he said, as investors await fresh news on the outlook for the global economy, and on U.S. monetary policy.

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