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NEW YORK/LONDON (Reuters) - Gold bullion came just short of its all-time high and U.S. gold futures ran up to their highest close ever on Thursday on both concern over Europe's credit problems and downbeat U.S. data which encouraged a fresh sweep into safe-haven assets.
Euro strength also propelled gold's advance after European ministers jointly backed the publication of so-called bank "stress tests," along with a successful Spanish bond auction.
Spot gold advanced to $1,244.45 an ounce by 2:29 a.m. EDT from $1,229.60 an ounce late Wednesday. Its session high reached $1,250.65 an ounce, just short of its all-time peak at $1,251.20 hit on June 8.
U.S. gold futures for August delivery surged $18.20 to finish at $1,248.70 an ounce, its highest close on record.
"There's no consistency right now in terms of good news coming out of the euro zone. And, because of that, it's making investors feel a bit uncertain about going into riskier assets. Gold is obviously a safe-haven asset to offset that," said Fred Jheon, managing director of U.S. product development at ETF Securities in San Francisco.
Euro's push to a three-week high against the dollar also renewed gold buying among some investors who are seeking the precious metal as a substitute currency.
"At the macro level, we're seeing central banks being net buyers of gold versus being net sellers for the first time in many years. So there's appetite at that level," said Jheon.
He added; "Investors are looking at the degradation of the dollar or the euro and are saying, 'Rather than hold a fiat currency, holding a hard currency like gold is a better investment."
Fiat currency is a currency that is legal tender by government fiat but has no fixed value against a hard asset such as gold or silver.
The euro gained after a Spanish bond auction soothed worries about the country's finances and worse-than-expected U.S. data weighed on the dollar.
"Gold is looking for any and every opportunity to go higher, and we all know the reasons why--the safe-haven factor, sovereign debt risks and so on," said Peter Hillyard, head of metals sales at ANZ Investment Bank.
"The mood is with gold right now, the momentum is with gold and the market will either do nothing or go up," he said.
Weaker U.S. economic data showing Mid-Atlantic factory activity plummeted in June and a rise in the number of U.S. workers filing for unemployment benefits last week also drove anxious investors to return to gold as a safety play.
Concern investors have about some debt-laden euro zone economies, such as Spain, has not receded.
The premium bond holders demand to own 10-year Spanish government debt over benchmark German bunds hit a euro lifetime high on Thursday, although an auction of Spanish 10-year bonds attracted good demand.
At a summit of EU ministers in Brussels, Germany joined France and Spain in calling for the publication of bank stress tests and leaders sought to play down Spain's problems and said the country was not on the agenda.
Interest in physical gold as an investment product kept holdings of the world's largest gold-backed exchange-traded fund, New York's SPDR Gold Trust, at a record above 1,306 tonnes on Wednesday.
Spot silver rallied to $18.71 an ounce, up from $18.40 an ounce late on Wednesday, but off earlier one-month highs at $18.86 an ounce.
Platinum firmed to $1,574 an ounce, up from $1,566.50 an ounce in late Wednesday trade, and palladium moved up to $479.50 from $471.0 previously.
Additional reporting by Jan Harvey;Editing by Sofina Mirza-Reid