NEW YORK - July 6, 2011 - Gold prices climbed for a third day Wednesday, rising to a two-week high after a rate hike in China put inflation concerns back in the spotlight and as worries over euro zone debt stoked safe-haven buying.

After rising in tandem with oil and grains on Tuesday, gold broke away from a lackluster commodities complex and shrugged off a stronger dollar as risk-aversion pushed prices toward the top of the market’s two-month trading range.

“People are choosing gold right now looking for some safe-haven investment and I think that might continue for a while,” Michael Daly, gold specialist, at PFGBest in Chicago.  Spot gold’s rose to $1,529.94 an ounce by 2:50 p.m. (ET) from $1,515.70 late in New York on Tuesday. Earlier, it reached a two-week peak at $1,533.45.

U.S. gold futures for August delivery added $16.50 an ounce to settle at $1,529.20 an ounce, a 1.09% increase, after rising earlier to a two-week peak at $1,534.50.

“With China raising rates; normally when a bank of that size raises rates it’s negative for gold and silver, but I think savvier investors are more concerned about inflation, because higher cost of living is going to trickle down globally,” Daly said.

Overnight, China’s central bank increased interest rates by 25 basis points, its third increase this year, making clear that taming inflation is a top priority even as economic growth slows modestly.