MUMBAI (Commodity Online): Gold continued its march to new record levels this week also with the international bullion market witnessing $1,226 per ounce prices on Thursday.

And if comments from experts like UBS AG are any indication gold prices are heading for $1,300 per ounce levels in the coming months.

Central bank purchases will also support bullion prices, Dominic Schnider, head of commodities research at the bank’s Wealth Management Research, said.

Purchases by Reserve Bank of India, Mauritius’s central bank and Sri Lanka from the International Monetary Fund helped fuel gold prices.

Gold prices will average $1,150 an ounce in 2010, UBS said. Prices averaged $962.39 an ounce this year.

Schnider did not rule out the potential for gold to move easily beyond $1,500 an ounce on a combination of accelerating inflation, a weakening dollar, increasing cost of production and rising demand.

Hopes of central banks buying the yellow metal would continue to aid sentiment. The benchmark February gold on India’s Multi Commodity Exchange (MCX) closed 1.3 per cent higher at Rs 18,187 per 10 gm on Thursday, after hitting a record high of Rs 18,240.

The trend is still up on dollar weakness and hedge fund buying overseas. Gold may see an upside till Rs 18,350 in India.

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