February 21, 2014 / 10:51 AM / in 4 years

PRECIOUS-Gold posts third straight weekly gain on U.S. economic worries

* Weak US home sales, manufacturing data boost bullion
    * Renewed fund interest in gold lift prices -analyst
    * Physical demand weak as prices stay near 3-1/2 month high
    * Coming up: U.S. Chicago, Dallas Fed manufacturing indexes

 (Adds comment, second byline, dateline, updates market
    By Frank Tang and Jan Harvey
    NEW YORK/LONDON, Feb 21 (Reuters) - Gold rose on Friday,
notching its third consecutive weekly gain, as doubts over U.S.
economic recovery helped lift bullion's safe-haven appeal.
    Bullion was supported after a report showed existing U.S.
home sales fell more than expected to an 18-month low in
January, the latest metric to indicate softness, though many
analysts attributed the weakness to weather instead of worsening
    The yellow metal rallied to a 3-1/2 month high earlier this
week after a series of disappointing U.S. economic indicators
including weak manufacturing data sparked speculation that the
Federal Reserve would slow the tapering of its bond purchases.
    Miguel Perez-Santalla, vice president at online precious
metals market BullionVault, said the metal's ability to hold
above key technical support at $1,200 an ounce earlier this year
rekindled fund interest to buy gold.
    "I believe that the large investment firms have rebalanced
their portfolios to include gold. And that is a main factor
sustaining gold and may drive prices up into the future," said
    Spot gold was up 0.4 percent at $1,327.56 an ounce by
2:33 p.m. EST (1933 GMT).
    U.S. COMEX gold futures for April delivery settled up
$6.70 an ounce at $1,323.60, with trading volume about 40
percent below its 30-day average, preliminary Reuters data
    On Tuesday, the metal hit $1,332.10, its highest since
October, lifted by follow-up demand after gold posted a more
than 4 percent gain last week.
    The world's largest gold-backed exchange-traded fund, SPDR
Gold Shares, notched its first weekly outflow in four
weeks, of 5.6 tonnes. 
    Buying in Asia, a major demand center for physical gold,
remained light. Dealers saw purchases in the physical market
this week, but many jewellers could be waiting for a correction.
    "I think (the price) is a little bit too high for Asians to
buy gold, because we've been below $1,300 for a long time and
people bought a lot," Yuichi Ikemizu, branch manager for
Standard Bank in Tokyo, said. 
    Among other metals, silver gained 0.4 percent to
$21.88 an ounce. Palladium was up 1.1 percent at
$1,426.24 an ounce, while platinum rose 0.8 percent to
$739.50 an ounce.
    Dealers said a violent attack in the turbulent, strike-hit
platinum mining belt in South Africa lifted prices. A miner was
killed by group of men at mine belonging to Anglo American
Platinum, police said on Friday. 
 2:33 PM EST     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold APR   1323.60   6.70   0.5  1315.90 1328.80   94,765
 US Silver MAR  21.782  0.098   0.5   21.575  21.975   52,528
 US Plat APR   1427.90  15.40   1.1  1415.40 1431.00    8,021
 US Pall MAR    740.00   3.70   0.5   734.25  742.00    6,125
 Gold          1327.56   5.05   0.4  1316.40 1328.40         
 Silver         21.880  0.080   0.4   21.600  21.940
 Platinum      1426.24  16.04   1.1  1418.00 1429.50
 Palladium      739.50   5.73   0.8   737.50  741.00
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold        113,126   163,259   183,234     15.98    0.13
 US Silver       81,328    61,186    57,500     26.23   -1.72
 US Platinum      8,266    10,500    13,324     16.29   -1.51
 US Palladium    10,586     6,443     5,709     14.13   -0.43
 (Additional reporting by Lewa Pardomuan in Singapore; Editing
by Louise Ireland, Jane Baird and Meredith Mazzilli)
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