Silver also surged on increased offtake by industrial units and coin makers.
Sentiments turned better on a firming trend overseas as escalating violence in Iraq boosted demand for the precious metal as a safe-haven, traders said.
Globally, gold in New York, which normally sets price trend on the domestic front, rose 1.7 per cent this week. In addition, depreciating rupee against the dollar which makes the import of the precious metals costlier further supported the upswing, they said.
Meanwhile, the rupee fell to close at 59.77 against US dollar on rising risk aversion after global oil prices surged on supply concerns over the unrest in Iraq.
In the national capital, gold of 99.9 and 99.5 per cent purity after commencing steady at Rs 27,100 and Rs 26,900 per ten grams, made rally on the back a firming global trend and closed at Rs 27,790 and Rs 27,590 per ten grams, showing a rise of Rs 690 each.
In line with overall trends, silver ready ended higher by Rs 1,875 to Rs 42,500 per kg and weekly-based delivery gained Rs 1,880 at Rs 41,875 per kg.
Silver coins spurted by Rs 2,000 to Rs 77,000 for buying and Rs 78,000 for selling of 100 pieces.