Gold prices today surged Rs 605 to hit one-month high of Rs 28,625 per ten gram in the national capital, recording the biggest single-day gain this year, after the precious metal posted its steepest rise in nine months in the global markets.

Silver also spurted Rs 1,800 to Rs 44,900 per kg on increased offtake by industrial units and coin makers.

Market sentiment bolstered after gold rose the most since September 2013 in global markets as the dollar weakened, amid expectations that borrowing costs in the US will remain low.

The worsening crisis in Iraq also fuelled the demand for bullion as an alternative investment.

Gold in global markets, which normally sets the price trend at the domestic front, climbed to $1,322.12 an ounce in Singapore, the highest level since April 12.

In addition, depreciating rupee against the dollar which make import of gold costlier also influenced the sentiment, they said.

In Delhi, gold of 99.9 and 99.5 per cent purity surged Rs 605 each to Rs 28,625 and Rs 28,425 per ten gram respectively, a level last seen on May 22. Sovereign followed suit and shot up Rs 300 to Rs 24,900 per piece of 8 gram.

In a similar fashion, silver ready spurted Rs 1,800 to Rs 44,900 per kg and weekly-based delivery by Rs 1,900 to Rs 44,380 per kg. Silver coins zoomed Rs 3,000 to Rs 80,000 for buying and Rs 81,000 for selling of 100 pieces.

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