Gold jumped on the last trading day of 2012 to finish up 6 per cent on the year on news of a possible U.S. fiscal deal, which lifted a market that had rallied earlier in the year on low interest rates, euro zone worries and central bank demand for bullion.
Other precious metals finished strongly, with palladium up nearly 10 per cent on the year, silver up 9 per cent and platinum up 8 per cent.
It was the 12th straight year of gains for gold, making it one of the longest bull runs ever in a commodity. Oil, in contrast, has only been up for a fourth year since its rebound from the 2008 financial crisis.
Analysts expect bullion, which started 2012 at below $1,580 (U.S.) and scaled nearly $1,800 by October after the U.S. Federal Reserve rolled out a fresh economic stimulus, to chart newer peaks in 2013. The market's all-time high above $1,930 was set in September, 2011.
"If anything, gold's rally [Monday] with the removal of the U.S. fiscal cliff proves that it's become a risk asset more than a safe haven," said Adam Sarhan at Sarhan Capital in New York.
Traditionally an inflation hedge and a market that investors rush to in times of trouble, gold has lately behaved more like an industrial commodity – rising and falling with the stock market and sometimes even following the dollar.
Worries about the so-called fiscal cliff had weighed on markets for weeks as the White House and its rival Republicans in Congress sought to find ways to avert some $600-billion in tax hikes and spending cuts that could have sent the economy into another recession in 2013.
A vote on a deal passed in the U.S. Senate early Tuesday. The House of Representatives is expected to vote on the package Tuesday afternoon.
Gold futures' most-active contract settled at $1,675.80 an ounce, up 1.2 per cent for the session and 6.1 per cent on the year. Until news of the fiscal deal emerged, the market had barely gained half a per cent.
The spot price of bullion hovered above $1,670 an ounce, up 1 per cent on the day and up nearly 7 per cent for 2012.
Although they moderated towards the year end, gold prices were up sharply in the first and third quarters, aided by ultra-loose monetary policy in the world's leading economies, bullion buying by central banks trying to diversify foreign reserves and concerns over the financial stability of the euro zone.
The rally in those quarters gave gold almost all of its 6 per cent annual gain, ensuring its unbroken run since 2001.
Platinum, palladium and silver – also counted as precious metals along with gold – outperformed bullion for the year.
Palladium has been on a bullish trend since November when refiner Johnson Matthey projected the biggest supply deficit in 11 years in the metal largely used in auto exhaust systems.
The spot price of palladium hovered near $700 an ounce, up more than 7 per cent for the year.
Platinum has turned volatile after rallying earlier in the year on concerns about sprawling worker strikes in top producer South Africa.
U.S. platinum's front-month contract fell to a four-month low before recovering to finish at $1,538 an ounce, up 10 per cent for 2012.
Silver was up 1 per cent on the day and 9 per cent on the year, hovering at just above $30 an ounce.