Gold futures surged to its new record price on Thursday after earlier rallies on news of an interest rate cut, led by global supply and demand concerns.

Gold traded at $931.50 an ounce during afternoon trading on the New York Mercantile Exchange, surpassing Monday's record high of $929.70 an ounce.

Today could prove to be pivotal for gold's near-term direction as a failure to extend above its record high could trigger a stale selling correction back to $895, said James Moore, metals analyst at TheBullionDesk.com, in a research note.

The precious metal gained on Wednesday following the Federal Reserve decision to cut key interest rate by half a percentage point, making it the second cut in over a week. The economy is stimulated with lower interest rates but it can also weaken the value of the dollar. Investors concerns over the slumping stock market and rising inflation have left them turning to gold as a safe net for investment. As a result, gold price has been on the steady rise.

Although gold has remained popular during times of economic trouble, the commodity has historically failed to keep up with inflation.

Precious metal Inflation Gold Price