Gold surged to a record high just under $900 an ounce on Wednesday, powered by heavy buying by investment funds and helped by rising oil prices and a strong debut for Shanghai gold futures.

Platinum also set a lifetime high on positive fundamentals and tracking gold's rally. Silver touched two-month highs and was not far from its highest level in 27 years.

Spot gold jumped to $891.40 an ounce, surpassing the previous record of $881.10 reached on Tuesday. It was quoted at $885.0/885.80 at 6:33 a.m. EST, compared with $878.10/878.90 in New York late on Tuesday.

"This is an extension of the ongoing rally with very strong underlying interest in buying gold across geographic locations," said David Holmes, director of precious metals sales at Dresdner Kleinwort Investment bank.

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"Clearly, the jewelry demand is suffering as a consequence of the high price, but it's being more than offset by broad-based global investor demand in gold. We are very much trading on momentum and gold is currently self advertising.

"I perceive that it's possible for gold to continue making new highs. $900 is clearly within reach and given its recent momentum it may continue making progress towards the psychologically-important $1,000 level," he said.

The market gained momentum after the key Japanese gold futures price hit its highest level since March 1984 and gold futures were launched on the Shanghai exchange.

The contract surged to nearly $1,000 an ounce on Wednesday, as enthusiastic new bullion bulls bid a hefty premium over their global peers.

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