Gold surged to within striking distance of the $900 mark on Friday on concerns about the outlook for the dollar and the US economy after Ben Bernanke, chairman, indicated the Federal Reserve was prepared to cut interest rates sharply to avoid a recession.

Gold reached a record $898 a troy ounce before easing back to trade at about $896.60 on Friday, up 0.8 per cent on the day and 4.1 per cent higher over the week.