Monday, bullion drifted higher hitting a record above $1,160 an ounce after a rally in the dollar ran out of steam, strong oil prices resurrected inflation worries, and a drop in US stocks mixed doubt about the economic forecast.

 Gold surged by $14.65 an ounce to the level of $1,162.85 an ounce by 3:54 GMT, compared to New York's notional close on Friday. It hit another record at $1,164.35 in thin trade also driven by technical buying after bullion surpassed previous records.

 Precious metal, which has gained around 32% so far in 2009, struck a succession of lifetime highs in November as sentiment turned extremely bullish after India acquired 200 tonnes of the precious metal from the International Monetary Fund.

 The dollar was trading lower during thin trade on Monday, giving up some of last week's gains, while oil rose above $78 a barrel on heightened tensions between Iran and Western nations. 

 Theoretically, a weaker dollar makes dollar-priced gold cheaper for holders of other currencies, while strong oil prices raise the bullion's safe-haven demand against inflation. 

 Trading was thin, with Japanese speculators were away on holiday, but dealers noted buybacks and limited scrap sales by jewellers in Asia on expectations that gold prices could rise further.

 U.S. stocks fell for a third straight day on Friday as investors took weaker-than-expected results from Dell and D.R. Horton as a further sign the recovery would be anemic.

 Traders are betting gold will hit $1,200 an ounce or higher by early next year, and strong options interest could in turn lift underlying prices further into the uncharted territory.

 US gold futures for December delivery GCZ9 added $16.7 an ounce to $1,163.50 on the COMEX division of the New York Mercantile Exchange, having struck a record at $1,164.80.

 The SPDR Gold Trust said its holdings stood at 1,117.493 tonnes as of November 20, unchanged from the previous business day.

 Around 3:54 GMT the precious metals was quoted as much as:

 Metal Last Change Pct chg Day ago pct MA 30
 RSI Spot gold $1162.85 $14.65 +1.28% +29.64% $860.10 77
 Spot silver $18.69 $0.23 +1.25% +56.01% $11.29 64
 Spot plat $1459.50 $18.50 +1.28% +1.04% $1372.13 67
 COMEX gold $1163.20 $12.00 +1.04% +1.43% $1089.45 77