_iNVEZZ.com: Monday, February 17th:_ The XAU/USD has today reached its highest level since 31 October at $1,329.71 an ounce, on safe-haven investing amid general US growth uncertainty and a weaker dollar.



Gold has so far this year gained about 10 percent after shedding 28 percent in 2013.

Both investor positioning in gold and the technicals seem to suggest the upside could continue.

UOB-Kay Securities senior analyst Helen Lau thinks that in the near-term gold price would be driven by weak “US macro data and increasing portfolio allocation to gold for diversification”.

Spot gold is currently at $1,325, up more than 0.5 percent. The commodity last week gained four percent, its biggest intraweek gain since last August.

“We are bullish gold, targeting a full retracement back to the $1,433 high from August 2013,” say ScotiaMocatta analysts.

According to the Commodity Futures Trading Commission, speculators have raised their bets in gold futures and options to hit a three-month high.



US government filings also reveal that the hedge fund Paulson & Co maintained its stake in the SPDR Gold Trust in the fourth quarter of last year.

The trust, the world’s biggest gold-backed exchange traded fund, declined by 5.10 tonnes to 801.25 tonnes on Friday, logging the first decrease in three weeks. Last year, the fund’s holdings saw an outflow of 500 tonnes.



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“We’ve seen a significant turn in exchange-traded fund holdings,” says ANZ Banking Group analyst Victor Thianpiriya. “People are starting to look at it and think that sentiment amongst the longer-term investors is holding or turning for the positive”.



Gold premiums in India, the world’s second-largest gold consumer after China, declined 17 percent to $62 an ounce on Friday –lowest point for the past four months – as buyers await a widely-expected cut in import duty soon.

All India Gems and Jewellery Trade Federation director Harshad Ajmera writes that the duty cut is an active rumour and that the market today “is expecting a cut of a minimum two or maximum five percent”.

He adds that “no-one wants to buy at a higher duty so people have reduced orders, preferring to wait”.

“Falling premiums can discourage jewellery imports, thus cutting off a source of supply that was strong during December and January,” says Thomson Reuters analyst Sudheesh Nambiath.

In China, premiums for gold of 99.99 percent purity on the Shanghai Gold Exchange today grew to around $7 an ounce from $5.50 on Friday. Trading volumes were down.