Gold prices in New York rose to a 24-year high, climbing for the seventh time in eight sessions, as fund managers seek to diversify from currencies, stocks, and bonds.

Funds tracking commodity indexes attracted $15 billion more cash in the past five months, partly on demand for a hedge against inflation, Barclays Capital said on December 2. Some investors buy gold in times of rising consumer prices, which erode the value of fixed income assets, such as bonds. Gold climbed 18% this year, outpacing a 4% gain in the Standard & Poor’s 500 Index.

“Gold is emerging as a `fourth global currency,'” analysts at Citigroup Global Markets, John Hill and Brian Yu, said in a report yesterday. “We regard gold as an essential barometer in the grand battle between hard and financial assets, which has strongly favored commodities and real estate over the past three years.”

Gold for February delivery rose $3.40, or 0.7%, to $517.20 an ounce at 12:03 p.m. on the Comex division of the New York Mercantile Exchange. Prices earlier reached $520.30 an ounce, the highest for a most-active contract since April 1981. A futures contract is an obligation to sell or buy a commodity at a set price by a specific date.

Gold, headed for a fifth straight annual gain, has outperformed the dollar, euro, yen, and other major currencies in 2004. Consumer prices in America in the 10 months ended October rose at a 4.9% annual rate, compared with a 3.7% rate a year earlier. Oil and fuel costs have surged to records this year.

Gold futures surged to $873 an ounce in 1980, when American consumer prices rose 12.5% from the previous year.

“Gold is getting more and more intrinsic appreciation as a currency than it is as a precious metal,” said Philip Manduca, who helps manage about $300 million at Titanium Capital in London.