Gold rose to a record high $1,104.80 per ounce on Monday, as the dollar continued its slide, and investors hurrying for a safe haven buying after bleak US unemployment data.

Experts say the surge in gold prices may not be arrested soon driven by persistent weakness in the US dollar which has lifted its appeal as an alternative investmenttool.

Gold prices in London, New York and Shanghai surged to records as the weakening dollar prompted investors to increase bullion holdings as a store of value. At Singapore, gold for immediate delivery shot up by $10.01 to reach an all-time high of $1,105.11 an ounce as expectations for record low borrowing costs in the US drove down the dollar, gold buying by the Reserve Bank of India last week raised speculation that other countries will follow suit.

The standard gold price in India hit a record high of Rs1 6,700 per ten grams and may soon cross Rs 17,000 per 10 gram in the middle in of the wedding season.

Experts also say that the spiralling price of gold can be attributed to Reserve Bank of India's recent buy of 200 tonnes of the metal. The world gold council on Monday said that the Central Bank of Sri Lanka (CBSL) had announced plans to buy gold from the International monetary fund in order to diversify its reserves.

“As the dollar continues to weaken and central bankers around the world realise the continuing importance of gold in providing economic stability, the confidence that an allocation to gold increases the risk-weighted returns of their reserve asset portfolios will increase. We believe more central banks in Asia and beyond will now announce increased allocations to gold,” said Aram Shishmanian, CEO of World Gold Council.

Gold prices have gained over 25 per cent across the world so far this year. In fact, India accounted for more than 20 per cent of global demand for gold jewellery last year and the improving economy will fuel demand for the yellow metal among in the country taking its prices higher and higher.