Gold on Tuesday broke through the key psychological level of $500, its highest level since December 1987.

Gold held above $500 for just one day in December 1987, while in February 1983 it managed a few attempts, peaking at $509, before falling to $340 by the end of that year.

Paul Merrick, vice president commodities and foreign exchange at RBC Capital, said on Monday current strong fundamentals and insatiable investor demand made a repeat of this price action unlikely in 2006.

“Today’s strength has again been built on Japanese investors, keen to diversify away from stocks, bonds and currencies,” he said.

Benchmark Tokyo gold futures prices hit a 15-year high of ¥1,954 a gram, up ¥31/g on the day.

Gold has risen in all significant currencies this year, as it has de-coupled from traditional role as a negative correlation to the dollar.