Gold prices on Wednesday sky-rocketed by Rs 340 at Rs 11,510 per ten gram as investors directed their money to the precious metal after the dollar fell, sparked by Federal Reserve cutting key interest rates.

The precious metal was a little short of its all-time high of Rs 11,710 per ten gram reached on January 15.

In a biggest cut of the last two decades years, the US central bank on Tuesday reduced key rates -- Fed funds rate and discount rate -- nbsp; by 75 basis points to prevent the United States from recession.

Gold for immediate delivery rose to $893.55 an ounce, 2.3 per cent below its highest ever level of 914.30 dollar in global bullion markets.

The euro jumped the most since January 2006 against the dollar on Tuesday, and stood at $1.4623 on Wednesday from 1.4629 on Tuesday. The dollar was at 106.40 against the yen, from 106.44 on Tuesday.