Gold saw a 12% rise year-on-year at the end of 2017, and has continued its run over $1,300 per ounce in the first days of 2018.  

Hansen said the end of the year gains had made up for a 7.5% fall between September's high of $1,350/oz and the mid-December trough below $1,250/oz.

"Following the strong sprint during the final couple of weeks of 2017, gold managed to finish more than 12% higher on the year," he said.

"One of the biggest surprises of the year was the dollar, which against an index of major currencies saw the biggest decline since 2013.

"The 10% decline in the (US dollar index spot) helped to explain the bulk of gold's performance but it nevertheless managed to attract additional demand despite record stock market valuations and surging demand for cryptocurrencies."

The three interest rate rises in 2017 and saw gold fall but buyers returned each time to help it reach that 12% year-on-year growth level.

Hansen said exchange-traded fund buying would continue into the new year, and also that hedge funds would buy back some of the long positions sold off in December.

"Total holdings in exchange-traded products backed by gold rose by 230 tonnes (8.1 million ounces) last year to 2,234 tonnes which is close to the highest level in almost five years," he said.

"Investors seeking protection against corrections in stocks from record levels and key government bonds from near-record low yield levels helped provide underlying demand.

"This happened despite the volatility being provided by hedge funds continued adjusting of positions."