NEW YORK (Dow Jones)--Gold stood out as a beacon of safety as investors, anxious about an escalating U.S. debt crisis and weaker-than-expected growth, pushed prices to a record on Friday. Washington lawmakers have just four days left to raise the debt ceiling and prevent a government debt default in the world's largest economy. Yet the White House and Republican Party leaders remain split on how to cut spending and increase the national borrowing limit. Gold prices jumped to an intraday record $1,637.50 a troy ounce as investors reached for what is widely considered the ultimate safe haven. Gold tends to be retain its value more than other assets at times of elevated anxiety and is more resilient to market shocks. "After seven days of stock market losses and doubt investors were buying gold as a general hedge against further declines," said George Gero, vice president with RBC Capital Markets Global Futures. The most actively traded gold contract, for December delivery, settled at a record $1,631.20 a troy ounce, up $15.00, or 0.9% on the Comex division of the New York Mercantile Exchange. The contract touched an intraday record of $1,637.50. August-delivery gold rose $14.90, or 0.9%, to settle at a record $1,628.30 a troy ounce. It earlier touched an intraday record of $1,634.90. Gold surged on weaker-than-expected U.S. growth data, which fortified investor concerns about the economy and pressured the dollar. The nation's gross domestic product grew at 1.3% in the second quarter this year, well short of the 1.8% growth forecast by economists. The government's first-quarter growth reading was slashed to a paltry 0.4%. The dollar sank to a record low against the Swiss franc and a four-month low against the yen, giving gold prices an added boost. Gold denominated in dollars appears cheaper to investors holding foreign currencies when the greenback weakens. Physical gold for immediate delivery, traded in London, hit a record $1,632.74 a troy ounce following the currency moves. With gold prices at record highs, technical indicators are at a loss to call a top to this rally, said Anne-Laure Tremblay, precious metals analyst with BNP Paribas. Instead, strong buying momentum is in place and will likely carry prices higher as uncertainty over the U.S. debt crisis grows. "If a resolution on the U.S. debt ceiling is not reached, gold's first move may be initially lower as it is sold to offset losses elsewhere in other assets. Subsequently, safe-haven demand should lift the price of gold," she said, adding that bank subscribes to the scenario in which a deal is struck in time. In the short term, however, investors are reaching for gold in all its forms in a bid to shore up their wealth. Exchange-traded funds backed by physical gold added 19.3 metric tons of gold Thursday, taking their total holdings to an all-time record of 2,202 metric tons, according to Barclays Capital. "Until we get ink on the deal it's very irrational for anyone not to buy gold going into the weekend," said Adam Klopfenstein, senior market strategist with Lind-Waldock. Taking a wider view, it appears that there is little to prevent gold prices from keeping up their steady upward march thanks to the widely shared belief that gold can shield investors against both inflation and deflation, say analysts with Deutsche Bank. "In almost any economic scenario today the advancing gold price appears to be irreversible," Deutsche Bank said. Silver futures have climbed as gold's record prices force investors to seek refuge in cheaper assets like silver. But while silver is up 15% this month, futures are well off the April highs of $49.560 a troy ounce. "The failure of the silver price to revert towards its April highs is not entirely surprising, its previous ascent had little to do with its fundamentals," BNP Paribas' Tremblay said. Silver for September delivery, the most actively traded contract, settled up 31.2 cents, or 0.8%, at $40.106 a troy ounce.

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