The managers have said the price of gold is now appreciating in its own right, rather than simply because traders are using the commodity to hedge out of the dollar.

This means further gains in the gold price are likely and the prices of gold equities – such as mining giants Newcrest and Randgold Resources – will gear up these gains sharply, they said.

Gold prices hit $1,230 a troy ounce last week, surpassing the previous high seen in December.

Crucially, they also hit an all-time high in euro terms of €939 (£800) a troy ounce – a gain of almost 26 per cent on the beginning of the year.

The rallies came after demand surged for the commodity, as investors flocked out of currencies amid fears over the state of government finances and inflation risks.

Investec Global Gold fund manager Daniel Sacks said the gold price could peak at $1,400 this year, but he preferred gold shares to buying the metal directly.

"The gold shares have done pretty poorly over the last few years compared with the metal," he said.

"There were lots of operational issues, but we should see some proper gearing coming through now."

He said the gold gains demonstrated the fact currency prices had to depreciate against something.

"That something is gold," he added. "It is gratifying to see the linkage to the dollar is dying down and gold is appreciating in its own right."

He said the gold price rallies were unlikely to be interrupted by increasing supply of the commodity because no gold mine is increasing its output.

"And the fact gold doesn't have any industrial use is pretty bullish because there isn't going to be any demand response to lower the price," Mr Sacks said.

BlackRock's Richard Davis, a fund manager on the team that runs the group's £2.1bn Gold and General fund, said lingering concerns over the Greek debt crisis were helping to boost the price.

"Uncertainty over global economic growth and an inconclusive election result in the UK have created nervousness in stock markets, and risk-averse investors are looking to gold as a store of value," he said.

"The fact gold bullion is a real asset, which does not depend for its value on any company or government, makes it compelling as a safe-haven investment."

He said continued investment demand would support gold prices in the medium term.

"It is worth noting that, adjusted for inflation, gold is still some way off its all-time high of $850 per ounce in 1980, which would be over $2,200 in today's terms," he added.

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