The rally gathered pace in early 2020 as geopolitical tensions rose and the coronavirus outbreak hurt growth worldwide, pushing governments and central banks to unleash vast amounts of stimulus, and sending real rates slumping further into negative territory.

"Gold has rallied sharply in last few days on back of weaker United States dollar, increased geopolitical tensions, rising virus cases strong investor inflows and continuing stimulus measures".

Investors continue pouring in money and bumping up demand to fuel gold rates as the coronavirus pandemic weakens confidence elsewhere.

The spot gold price rose 2.2% on Monday morning, overtaking its previous record from the financial crisis in September 2011, adding to the previous week's gains.

"Gold prices continued its bullish rally and made history finally taking out $1920 driven by escalating tension between U.S. and China and a weaker dollar, while expectations of more stimulus to revive pandemic-hit economics lifted the metals's appeal as an inflation hedge", said analysts at Motilal Oswal Financial Services Ltd. In the US, investor expectations for annual inflation over the next decade, as measured by a bond-market metric known as breakevens, have moved higher the past four months after plunging in March.

Forecasters watch their prices as an indicator of how investors see the economic future.

Bitcoin, the extremely volatile cryptocurrency that some proponents and marketers claim is safe from inflation, has also risen recently, crossing $10,000 for the first time in almost a year. China responded by ordering the closure of the US consulate in the southwestern city of Chengdu.

Bullion's move-which may put it on track to take out $2,000 an ounce-came as a gauge of the dollar sank to the lowest in more than a year amid negative real rates in the USA and bets that the Federal Reserve will keep policy accommodative when it meets this week.

All that has increased uncertainty about the direction of the economy.

Gold surged to a record high on Monday, but the precious metal's ferocious rally will likely run out of steam near $2,000, according to strategists at J.P. Morgan Chase & Co.

US Treasury Secretary Steve Mnuchin said the package will contain extended unemployment benefits with 70-percent "wage replacement". "And as long as the [virus situation] gets worse, the market is discounting more stimulus for a longer period of time and in bigger quantities, and all of that is bullish for gold", he said.

It's worth remembering during the latest gold rush that Warren Buffett, the billionaire investor and CEO of insurance conglomerate Berkshire Hathaway, has long warned investors against buying gold.