U.S. gold futures hit a six-month high of $1,000 and spot gold also rose to six-month high on Tuesday as the dollar's weakness, concerns about the sustainability of the global economic recovery and worries about inflation underpinned sentiment.

Some market players were cautious about prices sustaining $1,000, however, saying the rally had been driven by speculators and gold was an expensive buy in historical terms.

Futures have topped $1,000 nine times -- three times this year and six last year, including a record $1,033.90. Spot prices have risen above $1,000 just four times - once in February and three times in March 2008, when they hit a record $1,030.80.

Futures were always going to lead the way above $1,000, so spot can't be far behind. Gold's rising price is due to uncertainty all the way from personal investors right through to institutions, said Sandra Close, an analyst for gold research group Surbiton Associates.

There are questions out there over the health of economies, where interest rates are going. All that encourages gold hoarding. There's potential to see the price go even higher, she said.

Spot gold rose as high as $997.90, its highest since February, when it briefly topped $1,000, before easing to $997.00. New York's notional close was $993.85. At 0550 GMT, it was trading at $996.95.

U.S. gold futures for December delivery touched $1,000 briefly before slipping to $999.30 per ounce. Futures settled at $996.70 on Friday. U.S. markets were closed on Monday for the Labor Day holiday.

ARE HIGH LEVELS SUSTAINABLE?

Despite gold hitting $1,000, it is far from an inflation-adjusted record, which analysts at GFMS have put as high as $2,079 per ounce.

Some analysts have said the higher gold price reflects uncertainty across markets about how central banks will untangle themselves from fiscal stimulus aimed at reviving economic growth, as well as dollar weakness.

The Group of 20 finance ministers and central bankers said at the weekend they would not remove economic stimulus until the global recovery was well entrenched.

Others said buying momentum could wane to push prices back toward $950 before consolidating, given weak physical demand and a tendency by big Asian consumers to sell when prices rise.

I don't know if it will stay there for a particularly long (period). My view is that by the end of the year the gold price will be lower, probably down to around $950 an ounce, said David Moore, a commodities strategist at Commonwealth Bank of Australia.

A confluence of dollar weakness -- making the metal more attractive to non-U.S. investors -- and doubt about the sustainability of global economic recovery have prompted a spate of investors to seek refuge in gold.

The dollar held around 93 yen, although it was slightly lower on a basket of currencies in early trade. The dollar index <.DXY> is resting on trendline support at 78.00 and a sustained break lower would be quite bearish technically.

Along with currencies, analysts were watching stock markets to gauge gold's direction. A sell-off in equities on concerns about the economy could boost gold's safe-haven appeal.

The gold market has legged up into a new range, but we need to see it sustain at $1,000 for a few days to write a new long-term story, said Mark Pervan, a senior commodities analyst at ANZ Bank.

Gold bulls are easily spooked around these numbers and need to see them sustained to bolster confidence. Gold is rallying on fears of an equity retreat. The risk is that stocks will fall and people are hedging that by buying gold, he said.

Asian stocks were up marginally on Tuesday.

For a graphic on gold futures versus the S&P index, click: http://graphics.thomsonreuters.com/099/CMD_GLDSP0909.gif

Traders said volume was not large and as futures slipped soon after hitting the key level, and with spot struggling to extend gains toward $1,000, prices might languish during Asian trade.

I think these high levels could trigger selling ... and it might be difficult for gold to sustain the $1,000 level, said Shuji Sugata, a manager at Mitsubishi Corp Futures & Securities in Tokyo.

Investment flows took a break, with the world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, saying holdings stood at 1,077.63 tonnes as of September 7, unchanged from Friday.

The dollar steadied after falling the previous day as the weekend meeting of G20 finance chiefs boosted investor appetite for growth-related riskier assets like commodities and stocks.

In other metals, silver hit a 13-month high of $16.51.

(Additional reporting by Jim Regan, Miho Yoshikawa and Lewa Pardomuan; Editing by Sambit Mohanty)

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