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LONDON: Gold edged below $1,400 an ounce on Monday as a delay in possible US military action in Syria and improved economic data from China and Europe boosted the appetite for riskier assets, reducing its appeal as a safe haven.
But silver gained as much as 3.8 percent earlier, benefiting from strong economic numbers in China, where the manufacturing sector in August had its best performance for more than a year.
"The main supporting factor for silver has been the China PMI (purchasing managers' index), which aids the more industrial precious metals as well as copper," Societe Generale analyst Robin Bhar said.
"Also, the easing intentions of Obama wanting...the Congress to vote on the possible Syrian attack has seen the safe-haven bid come off, helping other financial markets and certainly silver, which is for the moment outperforming gold."
Spot gold was down 0.4 percent at $1,389.49 an ounce by 1158 GMT, after falling to a one-week low of $1,374.10 earlier. Prices were on track for a third day of declines.
Traders said volumes were likely to be thin throughout the day, because US markets are closed for the Labor Day holiday.
US President Barack Obama said he would seek congressional authorisation for punitive military action against Syria, almost certainly delaying any strike until Washington's summer recess ends on Sept. 9.
European shares rose sharply after strong euro zone data showed factory activity rose at its fastest pace in over two years, while oil prices firmed after a slow start.
Gold last week rose to its highest since mid-May to $1,433.31 on speculation of a strike against Syria, but gave up some gains after UK lawmakers voted against any involvement.
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