NEW YORK/LONDON: Gold fell on Friday as US equities climbed, but the yellow metal still posted its biggest monthly gain since July as persistent concerns about a slowdown in the US economy boosted bullion's safe-haven status.
Gold gained nearly 7 percent in February, its biggest monthly rise in seven, mostly due to signs of economic weakness in China and the United States as well as political and economic turmoil in Ukraine.
“In general, whether it's Ukraine, the US economic data or worries about China, there seem to be a lot more reasons than there were six weeks ago for looking at gold," Nomura analyst Tyler Broda said.
Spot gold was down 0.5 percent at $1,324.26 an ounce by 2:54 p.m. EST (1954 GMT), about $20 below a four-month high of $1,345.35 struck on Wednesday.
US COMEX gold futures for April delivery settled down $10.20 at $1,321.60 an ounce, with volume about 10 percent below its 30-day average, preliminary Reuters data showed.
Bullion fell as data showed the US government slashed its estimate for fourth-quarter economic growth on Friday in the latest sign of a loss of momentum, but some tentative signs emerged that suggested the worst of the slowdown may be over.
The gold market also ignored the dollar's fall to a two-month low against the euro after data showed euro zone inflation unexpectedly held steady this month and US economic growth was revised lower for the fourth quarter.
Premiums for gold bars in Hong Kong dipped to $1 an ounce to the spot London prices from as high as $1.70 last week, which reflected a slowdown in demand from China.
Weakening differentials between 99.99 percent purity gold on the Shanghai Gold Exchange and cash gold discouraged imports. On Friday, the Shanghai market was trading at discounts to almost on par with cash gold.
Among other precious metals, silver dropped 0.6 percent to $21.12 an ounce. Platinum was down 0.4 percent to $1,441.50 an ounce and palladium gained 0.3 percent to$740.75 an ounce.
On Thursday, platinum group metals had risen about 1.5 percent after the second biggest platinum miner Impala Platinum decided to declare force majeure on supply contracts, which allows certain terms of an otherwise legally binding agreement to be ignored. -Reuters