Gold hits record high
Precious metal continues record run despite stronger dollar, and outlook remains upbeat.
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LONDON (Reuters) -- Gold rose to a record high Tuesday, and analysts expect the momentum to continue, despite the dollar's recovery from a 15-month low.
While technical chart signals suggested the market looked overbought, analysts said the metal was still well supported above $1,130 an ounce.
U.S. gold futures for December delivery on the COMEX division of the New York Mercantile Exchange rose $2.00 to $1,139.40 an ounce.
"The uptrend is definitely firmly entrenched. $1,100 has proven to be a bit of a base," said Ole Hansen, senior manager at Saxo Bank.
"Technically, it's very overbought...indicating a period of stable prices or a bit of a setback before it gathers strength to make new highs," he added.
As gold is a non-interest bearing asset, the opportunity cost of holding it is reduced when rates are depressed. Opportunity costs represent possible profit shortfalls incurred by passing up on investments with potentially higher returns.
Gold's chief support has been weakness in the U.S. dollar, which slipped against a basket of six other currencies on Monday after senior Federal Reserve officials said U.S. interest rates will remain low.
However, the currency bounced back early on Tuesday, with the dollar index firming 0.83%. This has curbed gold's appeal as an alternative asset, and also makes all dollar-priced commodities slightly more expensive for other currency holders.
Oil edged lower after posting hefty gains on Monday, with traders citing the firmer dollar as a curb on the market, while base metals also gave up the last session's gains.
Gold dealers in India, the world's biggest bullion market last year, reported higher scrap sales on Tuesday after gold hit a fresh record high, but domestic demand abated after a slight pick-up late in the previous session.
Consumer demand for gold has been weak this year as prices have risen, but more buying has been taking place among central banks, who in recent years have chiefly been sellers of gold.
The International Monetary Fund said on Tuesday it sold two tonnes of gold to the central bank of Mauritius at prevailing market prices on Nov. 11.
Reports of the acquisition by India of 200 tonnes of IMF gold early in November were a key factor driving prices to record highs above $1,100 an ounce.
"It is clear that central banks are seeking ways to increase their gold exposure," said Fairfax analyst Marc Elliott.
Among other precious metals, spot silver was bid at $18.23 an ounce against $18.36. The metal touched a peak of $18.43 on Monday, its firmest since July 2008.
Platinum matched the last session's 14-month high of $1,451.50 an ounce and was later at $1,433.50 versus $1,441.00. Palladium hit a 15-month high of $375.70 before easing back to $367.50 an ounce versus $373.00.
Fellow autocatalyst material rhodium reached a 13-month high of $2,425. 
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