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PRECIOUS-Gold hits 3-month highs as Syria tensions stoke safe-haven buying
August 28, 2013 / 3:07 AM / in 4 years

PRECIOUS-Gold hits 3-month highs as Syria tensions stoke safe-haven buying

* Gold up 1 pct, hits highest since May 14
    * Silver climbs 2 pct to four-month top
    * Asian stock markets fall; oil jumps

 (Adds details on silver; updates prices)
    By A. Ananthalakshmi
    SINGAPORE, Aug 28 (Reuters) - Gold extended gains to a fifth
straight session on Wednesday and climbed over 1 percent to its
highest in more than three months, buoyed by safe-haven buying
due to geopolitical tensions in Syria. 
    Silver tracked gold higher, gaining more than 2 percent to
trade at its highest in more than four months.
    The United States and its allies geared up for a probable
military strike against Syria that could come within days and
would be the most aggressive action by Western powers in the
Middle Eastern nation's two-and-a-half-year civil war. 
 
    Stock markets in the United States and Asia fell on the
developments, while oil prices hit six-month highs. 
    "When things get uncertain you will always see a bigger
interest in gold," said Han Pin Hsi, global head of commodities
research at Standard Chartered Bank in Singapore.
    Spot gold climbed to $1,431.09 an ounce by 0621 GMT.
The metal hit $1,433.31 earlier in the session, its highest
since May 14. 
    Spot silver rose 2.3 percent to $25.02. 
    "We may be seeing a new trading paradigm setting in the next
few days, one whereby investors sour on stocks and file back
into commodities, with oil and gold likely being the two
favourites in the group," INTL FCStone analyst Edward Meir wrote
in a note. 
    Gold has lost about 15 percent of its value this year as
investors shifted to higher-yielding equities on the back of
strengthening U.S. economic data. 
    However, the metal has recovered about $240 an ounce, or
more than 20 percent, since hitting a near three-year low of
$1,180.71 in late June.
    Inflows into SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, have aided in boosting market
sentiment. Holdings are near four-year lows but have risen in
the last two weeks. 
    
    CENTRAL-BANK BUYING
    Data from the International Monetary Fund on Tuesday showed
that central banks continued to add to their gold reserves.
 
    Turkey added the most by buying 22.5 tonnes of gold in July,
while Russia's holdings topped 1,000 tonnes.
    "Emerging market central banks will continue to accumulate
gold as an important cornerstone to reserves, this is one of the
factors that will continue to underpin gold demand in coming
years," ANZ analysts said. 
    
  Precious metals prices 0621 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1431.09   15.05   +1.06    -14.54
  Spot Silver        25.02    0.56   +2.29    -17.37
  Spot Platinum    1539.49   20.69   +1.36      0.29
  Spot Palladium    745.72    3.72   +0.50      7.76
  COMEX GOLD DEC3  1431.40   11.20   +0.79    -14.58        24879
  COMEX SILVER SEP3  25.04    0.39   +1.58    -17.38        12658
  Euro/Dollar       1.3378
  Dollar/Yen         97.31
 
  COMEX gold and silver contracts show the most active months
 
 (Editing by Richard Pullin and Muralikumar Anantharaman)

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