The dollar retreated from its three-week high against a basket of major currencies after a rise in U.S. manufacturing activity prompted more risk taking.
The spot price of bullion peaked above the $1,790 an ounce level last seen in November 2011.
Dealers said a flurry of fund-related buying led to nearly 4.0 million ounces of gold changing hands on the U.S. futures market in a matter of moments.
Some suspected that central banks were also in the market, given the soft, long-term outlook for the dollar from stimulus action planned for economic recovery.
"When the dust settles, I wouldn't be surprised at all if we learn that central banks have been buying gold over the last couple of weeks," said Adrian Day of Adrian Day Asset Management in Annapolis, Md.
Some suspected that central banks were also in the market, given the soft, long-term outlook for the dollar from stimulus action planned for economic recovery.
"When the dust settles, I wouldn't be surprised at all if we learn that central banks have been buying gold over the last couple of weeks," said Adrian Day of Adrian Day Asset Management in Annapolis, Md.
More information can be found online at http://www.goldbullionadvisors.com
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