New Delhi, Nov 5 (PTI) Gold today rallied for the third consecutive day nearing the Rs 17,000-level in the bullion market here on increased demand, influenced by India's purchase of the metal from the International Monetary Fund.

Gold gained Rs 50 and touched a new peak of Rs 16,850 per 10 gram.

Marketmen said the precious metal remained in demand for the ongoing marriage season amid strong global cues.

Gold reached an all-time high of 1,099 dollar an ounce on the New York Mercantile Exchange last evening on the back of weakening dollar.

They said the metal, which had been on a record setting spree since the last few sessions, gathered momentum after the Reserve Bank purchased 200 tons of gold from the International Monetary Fund, raising speculation that more countries would follow suit.