In the international bullion market, the yellow metal gained $37 per ounce, pushing the global price to $4,007 per ounce.
Spot gold was up 0.7% at $4,011.79 per ounce by 0914 GMT, while US gold futures for December delivery rose 0.7% to $4,021.20 per ounce.
Mirroring the global trend, domestic bullion markets also saw a sharp rise, with the price of 24-karat gold increasing by Rs3,700 per tola to a new record high of Rs423,062 per tola.
Similarly, the rate of 10 grams of gold went up by Rs3,122 to Rs362,707.
Read: Gold prices fall in global, local markets
Silver prices followed suit, climbing by Rs90 per tola to Rs5,112, while the price of 10 grams rose by Rs77 to Rs4,382.
Elsewhere, spot silver rose 1.4% to $48.74 per ounce, platinum edged up 0.4% to $1,567.01, and palladium gained 1.1% to $1,434.22.
The surge comes after a two-day losing streak in both global and domestic bullion markets.