Gold is likely to hit $1,650 U.S. an ounce by the end of the year and could even hit $1,700 U.S., according to one analyst.
"The continuing sovereign debt crisis in Europe, and in the US there is the possibility of further stimulus so all this generates an environment that is positive for gold," Ong Yi Long, investment analyst at Phillip Futures told CNBC.
Spot gold has had its longest winning streak in four decades, and it hit above $1,600 U.S. an ounce earlier Monday, rising for the second consecutive week as weak confidence in the global economic environment saw investors seek security.
Ong told CNBC that silver could benefit from the rally in gold prices despite many investors piling into the metal, only to see prices plummet back in May.
"A lot of investors got their fingers burnt when there was the huge fall in silver prices.
"Investors are understandably cautious and time is needed for them to come back to the market, but with gold prices traded near record highs investors will look towards an alternative and perhaps silver could be the natural choice," Ong added.
Traditionally, the summer months tend to be a lull for gold as the monsoon season grips India -- the largest consumer market for the precious metal -- as a halt to weddings and festivals leads to weaker demand.
Ong advised any investors keen to hold gold to assess their risk profile before investing.
