Gold futures rose to a record $1,263.70 an ounce in New York on Friday as Europe's fiscal woes and dimming prospects for the U.S. economy prompted investors to step up purchases of bullion as an alternative asset.

The metal has climbed more than 15 percent this year, outperforming equities and bonds, while the euro slumped 14 percent. A majority of Greeks believe the country may go bankrupt, an opinion poll showed. Spain has 24.7 billion euros of maturing debt in July and may need to use a financial lifeline from the European Union.

``The problems over in Europe are just as pernicious over here in the U.S.,'' said Michael Pento, the chief economist at Delta Global Advisors. ``You can't trust sovereign debt and sovereign currency. Gold is the only real honest money that we have.''

Gold futures for August delivery rose $13.40, or 1.1 percent, to $1,262.10 at 12:28 p.m. on the Comex in New York. A close at that price would mark a fourth straight weekly gain, up 2.6 percent. Before today, the record was $1,254.40 on June 8. This month, the metal reached all-time highs in euros, U.K. pounds and Swiss francs.

Gold for immediate delivery reached a record $1,262.40.

Thursday, reports showed U.S. jobless claims rose unexpectedly and manufacturing in the Philadelphia region missed forecasts by analysts.

``People are looking at the euro as a wake-up call and they're skeptical of a U.S. recovery,'' said Adam Klopfenstein, a senior market strategist at Lind-Waldock, a broker in Chicago. ``The big fear is that there are going to be other governments who are going to have sovereign-debt risks. People are clamoring to get into gold.''

Gold may reach $1,400 this year and rise as high as $1,600 in 2011 should the Federal Reserve be forced to keep interest rates at a record low to stimulate the economy, said Pento of Delta Global.

U.S. lawmakers, debating a $50 billion jobs bill in Congress this week, are struggling to meet demands to spend more to boost the economy while cutting the government's $1.5 trillion deficit.

``Smart money like hedge funds and big insurance companies have been accumulating gold,'' James Dailey, the chief investment officer at TEAM Financial Asset Management in Harrisburg, Penn., said in an interview in New York. ``Gold has taken the monetary asset role.''

Gold may rally to $1,500 this year, he said.

Gold may climb to $1,400 in 2010 should the current pace of investment in Exchange Traded Funds continue, Goldman Sachs Group said in a report dated Thursday.