Gold surpasses $1,100 as traders chasing safety

The price zoomed back above the critical level for the second time in the past two weeks, as risky assets fall out of favour with investors worried over an uncertain outlook for the global economy.

Futures for gold rose on Wednesday and made high at $1109 levels. The precious metal closed at $1,107.8 an ounce on January 7, its first close above the psychologically significant $1,100 threshold since early November.

Bullion is usually rising in times of political and financial uncertainty as the metal is considered as a safe-haven asset. Stocks in Asia and Europe were steeply lower on Wednesday amid increasing worries over global economic growth, following fresh projections from the International Monetary Fund.

The global economy is expected to grow 3.4% this year, a slowdown from the prior forecasts of a 3.6% rise. China remains under the spotlight as the recent economic data confirmed the country's weakening economy.

China is the world's key gold consumer and a weaker economy may indicate slowing demand. The latest set of disappointing economic data spurred speculation that Beijing may soon announce more stimulus measures in order to revive the stalling economy.

The US dollar index was slightly lower on Wednesday, supporting demand for bullion that becomes cheaper in other currencies and so more attractive for international buyers.

Gold is hovering around $1100 levels, made intraday high at $1102 and low at $ 1097 levels.