NEW YORK/LONDON: Gold rose on Monday as the dollar fell on uncertainty about global economic growth, while the prospect of more economic stimulus from China increased bullion's investment appeal.
The yellow metal posted its fifth rise in the past six sessions after the dollar index fell on growth concerns and worries the US Federal Reserve may wait longer to hike interest rates.
Last week, the greenback notched its biggest weekly loss in six months.
Also underpinning gold was Chinese economic data for the third quarter suggesting the economy likely grew at its weakest pace in more than five years.
Investors speculated Beijing might roll out more stimulus measures.
Gold got a boost from a strong rebound in Chinese imports of industrial commodities in September.
Some market watchers said bullion was vulnerable to more losses on an improving US economic outlook.
Last week, the metal tumbled to $1,183.46, near a four-year low, following strong US jobs data for September.
"While the potential for a short-covering rally could see gold extend its gains, we believe the bounce is likely to be short-lived and remain cautious given the headwinds the macro environment presents," said Suki Cooper, precious metals analyst at Barclays Capital in New York.
Spot gold rose 0.7 percent to $1,231.50 an ounce by 2:58 p.m. EDT (1858 GMT) after hitting $1,237.30, its highest in nearly four weeks.
Last week, gold posted its biggest weekly gain in four months, rising 2.7 percent.
US COMEX gold futures for December delivery settled at $1,230 an ounce, up $8.30 in lighter-than-usual turnover, preliminary Reuters data showed.
Gains in gold, usually seen as a hedge against oil-led inflation, were limited by sliding Brent crude oil prices to their lowest since 2010.
Meanwhile, holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund and a proxy for market sentiment, fell 2.64 tonnes on Friday to 759.44 tonnes, its lowest since December 2008.
In Asian gold trading, Singapore launched 25 kg (around 804 ounces) gold contracts on Monday, the latest Asian country to start exchange-traded contracts with the aim of providing a regional benchmark price.
Asia, home to the world's top two gold buyers, China and India, has been clamoring to gain pricing power over the metal and challenge the dominance of London and New York in trading.
Among other precious metals, silver inched up 1 cent to $17.35 an ounce.
Platinum rose 0.9 percent to $1,261.74 an ounce, and palladium gained 0.5 percent to $783 an ounce.
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