Gold prices hit a record high and oil and stock prices around the world rose on Wednesday, while the dollar eased off ahead of U.S. inflation data and minutes from the Bank of England's November meeting.

World shares, as measured by the MSCI world equity index, edged up near their highest of 2009 hit at the start of the week, while gold rallied to $1,145.95 per ounce, its strongest-ever level.

The dollar slumped against a currency basket, restrained by the ongoing belief that the Federal Reserve will keep the Fed funds rate at essentially zero, keeping the returns on dollar-denominated assets low for some time to come.

European shares rose in early trade on the back of rising bank stocks approaching their highest level in more than a year hit on Monday. Asian stocks had risen earlier in the day, and analysts said expectations for ongoing low rates would keep demand for shares intact.

Our expectation is that we can add to these gains ... The interest rate environment is very friendly, said Henk Potts, equity strategist at Barclays Stockbrokers. The MSCI all-country world equity index <.MIWD00000PUS> rose 0.3 percent, hovering near its highest level since September 2008, which it hit on Monday. The index has rallied roughly 75 percent from a trough in March.

Spot gold rose was up around half a percent on the day, having rallied nearly 10 percent so far this month.

U.S. crude oil rose 0.7 percent, extending gains into a third day.

The FTSEurofirst 300 index <.FTEU3> rose a quarter of a percent to a few points below its highest level since October last year.

The index is up around 24 percent in 2009 and has surged 60 percent since hitting a record low in March.

Emerging stocks <.MSCIEF> rose 0.4 percent on the day.

DOLLAR DOWNTREND CONTINUES

The dollar <.DXY> fell 0.3 percent against a basket of major currencies, sticking close to a 15-month low hit on Monday.

Analysts said the broad downtrend in the beleaguered U.S. currency remained intact even as Fed Chairman Ben Bernanke this week has acknowledged its weakness -- a rarity for the U.S. central bank.

The relatively sanguine view on the U.S. dollar ... coupled with the belief that asset prices are not forming another bubble, should provide a green light for recent trends to continue, said Lauren Rosborough, senior currency strategist at Westpac in London.

Still, she added that some asset markets were looking overstretched following dramatic rallies this year, and that the bull trade was not as strong as it was in past months.

Euro zone Bund futures for December delivery were largely flat on the day at 122.22.

Market participants awaited a reading of U.S. inflation later in the day to better gauge the outlook for prices and interest rates.

Excluding volatile food and energy prices, U.S. CPI is expected to edge up 0.1 percent on the month in October, following a 0.2 percent rise in the previous month, while rising 1.6 percent on the year.

(Editing by Andy Bruce)

Inflation Gold