RTRS:PRECIOUS-Gold snaps three-day rally on profit taking
* Spot gold hits highest since Oct. 31 early in session
* Global gold demand slips 15 pct in 2013 - WGC
* Shanghai gold premiums ease to $4 an ounce
(Adds WGC data, updates prices)
By A. Ananthalakshmi
SINGAPORE, Feb 18 (Reuters) - Gold drifted lower on Tuesday
as traders took profits from recent gains, but the safe-haven
metal held not far off 3-1/2 month highs due to a weaker U.S.
dollar and concerns over global economic growth.
Bullion is up 10 percent this year - after losing nearly a
third of its value in 2013 - as outflows from gold-backed funds
slow and equities weaken due to emerging market jitters.
Gold gained for three straight sessions through Monday,
following weak U.S. economic data that also boosted silver.
Spot gold slipped 0.8 percent to $1,317.31 by 0732
GMT, after hitting $1,332.10 earlier in the session - its
highest since Oct. 31.
Silver also fell but wasn't too far from a 3-1/2
month high of $21.96 hit on Monday.
"Both gold and silver have good momentum, so expect the dips
to be shallow and supported," said one Hong Kong-based precious
metals trader. "Realistically expect a pullback that will run
into good buying before the next move higher."
The trader said some investors began selling after prices
pushed through Monday's highs. Buying will return between $1,305
and $1,318, he said.
Asian shares mostly eased after solid gains in recent
sessions, while the dollar was near six-week lows against a
basket of currencies.
Investors have been seeking shelter in gold after a string
of U.S. data showed the world's largest economy had been hit by
cold weather and fears of slowing growth in China.
Gold is often seen as an alternative investment to risky
assets such as stocks and is considered a haven during times of
economic uncertainty.
In the physical markets, Indian Finance Minister P.
Chidambaram said on Monday he will look into relaxing gold
imports curbs, but won't let the country's current account
deficit balloon.
To reduce its trade deficit, India introduced import
restrictions last year that have slashed official imports of the
metal, although smuggling has increased.
In China, premiums of 99.99 percent purity gold
on the Shanghai Gold Exchange eased to about $4
an ounce from Monday's $7 as buyers took a breather after the
price rally.
Data from the World Gold Council showed that global gold
demand fell 15 percent in 2013 as huge outflows from physically
backed investment funds outweighed record consumer demand.
Physical demand from India and China is expected to stay
near 1,000 tonnes each.
