SINGAPORE, Feb 12 (Reuters) - Gold on Friday clung to sharp
overnight gains that pushed the metal to a one-year high, and
looked set to post its best week in over four years as stock
market turmoil stoked safe haven demand.
Stock markets fell worldwide on Thursday on fears over the
health of the global economy and the banking sector, with MSCI's
global stock index closing more than 20 percent below its
all-time high. MKTS/GLOB
Safe-haven assets shone across the board. U.S. 10-year
Treasury yields hit their lowest since 2012, while the Japanese
yen climbed to its highest in 15 months against the dollar.
Spot gold XAU= rose to $1,260.60 on Thursday, its highest
in a year, before paring some gains to close up 4 percent in its
biggest daily gain in about 2-1/2 years. On Friday, it eased 0.8
percent to $1,236.60 by 0042 GMT.
"The risk-off sentiment that pervaded markets overnight saw
gold briefly push above $1,260 amid rising safe haven buying,
making it the best performing commodity in 2016," ANZ analysts
said in a note.
For the week, spot gold is up 5.5 percent, the biggest
weekly gain since October 2011.
Tracking spot prices, U.S. gold futures GCcv1 are set to
post a gain of 7 percent for the week, the biggest such gain
since 2008.
Also helping gold was dovish comments from Federal Reserve
Chair Janet Yellen.
Testifying for a second day before U.S. lawmakers, Yellen
again stressed that the U.S. central bank was not on a "pre-set"
path to return policy to "normal" amid a worsening meltdown in
global stock markets.
Yellen said she still expects the Fed will gradually raise
interest rates this year, given a strong U.S. labour market and
steady economic growth.
That, however, did not deter investors from piling on to
gold, a non-interest paying asset, as expectations grow that the
Fed would not be able raise rates this year.
Assets in SPDR Gold Trust, the world's top gold-backed
exchange-traded fund, rose 1.99 percent to 716.01 tonnes on
Thursday, the biggest inflow in two months. GOL/ETF
Jeffrey Gundlach, the co-founder and chief executive officer
of DoubleLine Capital, said on Thursday that gold prices are
likely to reach $1,400 an ounce as investors lose faith in
central banks. AT 0042 GMT
Metal Last Change Pct chg
Spot gold 1236.6 -9.91 -0.8
Spot silver 15.671 -0.069 -0.44
Spot platinum 954.16 -2.33 -0.24
Spot palladium 519 -2.45 -0.47
Comex gold 1237.8 -10 -0.8
Comex silver 15.7 -0.094 -0.6
COMEX gold and silver contracts show the
most active months