Gold futures rallied Tuesday to trade near a fresh 28-year high, propelled by the dollar’s tumble to yet another record low against the euro and by surging crude-oil prices.

Gold for December delivery rose $14.20 at $825 an ounce on the New York Mercantile Exchange. Earlier, the contract reached an intraday high of $826. The record high for Nymex gold was $875 set on Jan. 21, 1980, and the record settle was $825.50 set on the same date.

“The surging oil price is an important factor and investors are using gold as an inflation hedge,” said Mark O’Byrne, director of Gold and Silver Investments Ltd., in a research note. “But of more importance is the dollar falling to new all time record lows against the euro and a basket of currencies again this morning.”

“Morgan Stanley analysts have warned that the dollar could experience a more “violent correction” and their managing director in Asia Stephen Roach has said that gold will likely remain a safe haven given what is happening in the financial markets,” O’Byrne said. Read Full Story