Just before 1pm this afternoon, the spot price of gold was up 0.3 percent at $1,816.55 (£1,352.50) an ounce. This is the highest it has risen since November 22.
Meanwhile, gold futures rose 0.5 percent to $1,818.40 (£1,353.88).
Other precious metals also saw an increase in value, as traders look to invest in assets less tied to the US economy.
Many countries faced rising inflation this year as economies unlock from the pandemic, putting pressure on currencies like the US dollar.
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He told Reuters: “While there are concerns over the Omicron variant, the investment demand is quite flat.
“So it is just the year-end rally since there is still some risk-on sentiment present.”
Mr Trivedi added: “Gold may not rally too much in the absence of any major economic data and it will remain in this range.”
According to Reuters analysis, the US dollar had recently slipped to the lower end of its trading range when compared to other currencies.
This made gold more of an appealing investment to holders of other currencies.
Meanwhile, the price of silver rose 0.6 percent to $23.18 (£17.26) an ounce while platinum gained 0.7 percent to $977.51 (£727.80).
Palladium rose 0.2 percent to $1,975.43 (£1,470.80).
Coronavirus stimulus by the Federal Reserve is set to cease altogether by the end of March, with interest rates expected to rise in an effort to keep inflation in check.
One analyst suggested that these actions could see gold trade even higher in the new year.
Harshal Barot, a senior research consultant for South Asia at Metals Focus, said: “Given Omicron’s rise, expectations of hawkish Fed action in 2022 will see a rethink; and if this happens, gold could start to break out of its range.”
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