* Unsteady currency market prompts wave of gold buying
* Prices set for fifth week of gains as equities weaken
* Gold premiums in India down 30 pct on import speculation
* Coming up: CFTC Commitments of Traders report Friday
(Updates market activities)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, Jan 24 Gold rose to a two-month
high on Friday, posting its fifth consecutive weekly gain as a
global flight from emerging-market assets and declines in
equities increased bullion's safe-haven appeal.
Volatility in the currency market led by the plummeting
Argentina peso and Turkish lira prompted investors to buy gold,
The yen surged to a seven-week high against the dollar,
while the Swiss franc climbed to a five-week peak against the
euro as investors sought refuge in safe-haven assets after a
sell-off in emerging market currencies.
A second consecutive day of sharp losses in U.S. equities
also lifted gold. The S&P 500 index fell almost 2
However, gold investment demand remains weak, with the
world's largest gold-backed exchange-traded fund SPDR Gold
Shares posting a 5.4-tonne outflow on Thursday. Last week,
it logged its first weekly inflow since early November.
"It is questionable whether the price rise will be
sustainable given that six tons were withdrawn from the gold
ETFs yesterday," said Eugen Weinberg, head of commodity research
"The latest development is more likely to have been driven
by speculation," Weinberg said.
Spot gold inched up 56 cents at $1,264.51 an ounce by
2:29 p.m. EST (1929 GMT), having earlier hit $1,272.70, its
highest since mid-November.
U.S. gold futures for February delivery settled up $2
at $1,264.30, with trading volume about 5 percent above its
250-day average, preliminary Reuters data showed.
For the week, bullion is up 1 percent, its fifth straight
weekly gain for the first time since September 2012.
ASIAN GOLD PREMIUMS DOWN
Investors, however, are still wary of a market that took its
biggest tumble in more than 30 years in 2013.
Chinese demand eased, with premiums on the Shanghai Gold
Exchange dropping to $10 an ounce from $12 the previous day.
China in 2013 took over from India as the world's leading
consumer of gold jewellery, data from metals consultancy Thomson
Reuters GFMS showed.
Gold premiums in India fell more than 30 percent on Friday
from earlier this week on speculation over a possible easing of
restrictions on bullion imports.
Among other precious metals, platinum fell 1.9
percent to $1,423.99 an ounce as traders bet that strikes in
South Africa's platinum mining sector would be less damaging
Silver fell 1 percent to $19.79 an ounce, taking a
lead from gold, while palladium was down 1.5 percent at
$731 an ounce.
2:29 PM EST LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL
US Gold FEB 1264.30 2.00 0.2 1256.80 1273.20 146,712
US Silver MAR 19.765 -0.245 -1.2 19.715 20.285 39,911
US Plat APR 1428.60 -34.60 -2.4 1423.00 1462.00 16,003
US Pall MAR 734.80 -11.10 -1.5 733.30 748.30 4,745
Gold 1264.51 0.56 0.0 1257.25 1272.70
Silver 19.790 -0.200 -1.0 19.740 20.270
Platinum 1423.99 -28.01 -1.9 1426.50 1458.00
Palladium 731.00 -11.00 -1.5 736.00 746.00
TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 30D AVG 250D AVG CURRENT CHG
US Gold 191,227 130,505 187,172 17.12 0.61
US Silver 43,750 37,543 57,154 25.86 1.08
US Platinum 16,053 10,720 12,680 15.01 0.34
US Palladium 4,900 2,962 5,853 15.2 -1.88
(Additional reporting by Veronica Brown in London, A.
Ananthalakshmi in Singapore; Editing by Dale Hudson, Jane Baird,
Marguerita Choy and Paul Simao)