Gold prices extended earlier gains to hit their highest since June 30 on Thursday,

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with concerns over the outlook for global growth lifting demand for the metal as a haven from risk.

Spot gold hit a high of $1,244.00 an ounce and was bid at $1,243.25 an ounce at 1100 GMT, against $1,239.00 late in New York on Wednesday.

In India, people have bought gold in anticipation of higher prices in the future, dealers said.

"It has been a better year than last as people are buying on the fear that prices will rise. In coming months also we could see good sales," said Ganesh Agarwal, proprietor of Shiv Sahai & Sons, a wholesaler in Chennai in south India.

Up until August, India's gold imports could be more than 538 tonnes, topping purchases made last year, according to the World Gold Council.

India's gold demand surges during key Hindu festivals such as Dussera in October and Deepawali and Dhanteras in November. Dhanteras is India's single biggest gold buying day when people buy the metal to invoke prosperity.

"The feedback from a recent jewellery exhibition was good. Jewellers got many good orders," said Haresh Acharya, head of bullion desk at Parker Agrochem, a large wholesaler in Ahmedabad.

Traders are hopeful the buying trend is here to stay as India sees economic growth of more than 8 percent and good farm incomes after a normal monsoon. Gold jewellery is the most common gift at religious events in India, which accounts for 20 percent of global demand for the metal.

"I think in the investment side, definitely we are looking at it to increase. We can see it currently in terms of the ETF in India. There's really steady investment in it," said Ong Yi Ling, investment analyst at Phillip Futures in Singapore.

India's gold collections in exchange traded funds (ETF) -- instruments that trade like shares and are backed by physical gold holdings -- rose more than 82 percent on year in July.