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LONDON (Reuters) -- Gold prices hit record highs at $1,180.00 an ounce in Europe on Wednesday, boosted by a report that India may consider buying more bullion from the International Monetary Fund, and the weaker dollar.
Spot gold was bid at $1,178.30 an ounce at 1022 GMT, against $1,168.90 late in New York on Tuesday.
U.S. gold futures for December delivery on the COMEX division of the New York Mercantile Exchange also hit a record $1,180.40 an ounce and were later up $12.80 to $1,178.60.
India's Financial Chronicle newspaper said on Wednesday that India is open to buying more gold from the IMF, which is thought to have around another 200 tons to sell.
"This, and the weaker U.S. dollar, are enough in these markets to push gold further up," said Commerzbank trader Michael Kempinski. "It should be time for a consolidation, but it doesn't come... (we are) just making new highs."
"We see $1,200 earlier than expected," he added.
The market is sensitive to speculation of further official sector buying after news in early November that India's central bank had bought 200 tons of gold from the IMF sparked a rally.
Russia, Sri Lanka and Mauritius have since also announced gold acquisitions, and traders speculate that more central banks, particularly in Asia, could be open to gold acquisitions to diversify their foreign exchange reserves.
"We have had relatively supportive news from the central banks, particularly in Asia, confirming that there is demand for gold as a means of diversifying their large foreign exchange reserves," RBS Global Banking & Markets analyst Daniel Major said.
"There is plenty more potential for central banks to buy either IMF gold or other gold in the market to try and boost their reserves."
Spot gold was bid at $1,178.30 an ounce at 1022 GMT, against $1,168.90 late in New York on Tuesday.
U.S. gold futures for December delivery on the COMEX division of the New York Mercantile Exchange also hit a record $1,180.40 an ounce and were later up $12.80 to $1,178.60.
India's Financial Chronicle newspaper said on Wednesday that India is open to buying more gold from the IMF, which is thought to have around another 200 tons to sell.
"This, and the weaker U.S. dollar, are enough in these markets to push gold further up," said Commerzbank trader Michael Kempinski. "It should be time for a consolidation, but it doesn't come... (we are) just making new highs."
"We see $1,200 earlier than expected," he added.
The market is sensitive to speculation of further official sector buying after news in early November that India's central bank had bought 200 tons of gold from the IMF sparked a rally.
Russia, Sri Lanka and Mauritius have since also announced gold acquisitions, and traders speculate that more central banks, particularly in Asia, could be open to gold acquisitions to diversify their foreign exchange reserves.
"We have had relatively supportive news from the central banks, particularly in Asia, confirming that there is demand for gold as a means of diversifying their large foreign exchange reserves," RBS Global Banking & Markets analyst Daniel Major said.
"There is plenty more potential for central banks to buy either IMF gold or other gold in the market to try and boost their reserves."
