Gold soared to its most expensive price in six years this morning as speculators snapped up the precious metal amid increasing fears of war in Iraq.
Many investors have jumped into gold as a safe haven in a time of conflict, convinced of a growing momentum toward war.
Jitters in the precious metals market also kept the jewelry and autocatalyst metal platinum at 17-year highs.
Gold hit $364.50 an ounce in Asian trading, its highest level since January, 1997. Gold climbed 25 per cent in 2002 to make it one of the year's star performing assets. Gold is up 5 per cent so far this year.
"Gold is in the spotlight as a hedge against inflation and as an asset that can be trusted in times of war," Eagle Mining Research analyst Mr Keith Goode, said.
Higher oil prices and a hobbled US dollar were also pulling more investors into gold.
The euro held near recent three-year peaks against the dollar and rose to its highest against the yen since June 1999 as mounting anxiety over a possible war bolstered its safe-haven appeal.
The euro's ability to hold its footing above $1.07, after hitting a new three-year high at $1.0744 on Wednesday, showed its 8 per cent rally since early December had yet to lose steam, dealers said.