Gold priced in Euros and Sterling rose to new record highs Thursday morning in London, trading $5 below yesterday's all-time Dollar high as commodities fell and government bond prices rose.

A 2% surge in Asian stocks faded in European dealing. The Athens stock market retreated 1% by mid-afternoon.

"Unless the government of a major economy actually defaults, or the Dollar collapses, we expect gold to drop back to $1000 by the end of 2010," reckons Julian Jessop, chief international economist at Capital Economics, writing in today's Financial Times.

But "It's not just sovereign default that bond investors fear," argues Steven Barrow, chief currency strategist at Standard Bank.

"Resurgent inflation is also a worry. There may be some very early signs that these concerns could be realized in Europe."

Noting gold's fresh record highs overnight, "We expect fresh buying of Gold from trend followers adding to long positions," says the latest technical analysis from bullion bank Scotia Mocatta.

"From a measured move perspective, we calculate $1338 and $1369 as Fibonacci and Elliot wave projection targets. A two-year bull channel top comes in at $1352 today."

"Silver has been similarly impressive," says a note from Japanese metals conglomerate Mitsui, "outperforming gold to the upside over the past five days and firmly establishing itself as an investment metal over that period."

Today's Silver Fix in London came in at $19.43 per ounce, a new three-decade record some 9.7% above last Friday's finish.

Gold fixed at $1235 an ounce on Thursday morning, higher by 3.0% for the week-so-far.

"The sky is really is the limit," one London trader told Platts. "It feels like some resistance around $1250, but feels more like $1300, here we come!"

Oil prices meantime fell towards $74 per barrel following yesterday's news that US crude-oil stockpiles have grown in 14 of the last 15 weeks.

New US data showed import prices rising 11.1% year-on-year in April, however, ahead of analyst forecasts.

The UK's trade deficit was significantly worse than expected in March, yawning from £2.1bn to £3.6bn and spurring a fresh drop in the Pound.

Gold priced in Sterling rose to new record highs above £843 an ounce.

The Gold Price in Euros set a new record-high London Gold Fix at €982.81 (€35,589 per kilo).

Money-supply growth in the Eurozone continues at a "strong annual" pace, the European Central Bank said in its latest Monthly Report today, swelling by 10.9% in March.

Traders awaiting data on the ECB's first government-bond buying operations – announced at the weekend to defend "peripheral" debt markets – reported rumors that it had bought €20m chunks of Greek, Portuguese and Irish bonds on Monday and Tuesday, followed by Greek and Portuguese bonds on Wednesday.

"For a central bank that clearly prides itself on maintaining low prices, some of the things it has done recently – especially the bond purchases – must grate with the inflation hawks on the [executive] board," says Barrow at Standard Bank.

Looking to Buy Gold today...?