* Adjustment from recent rally intact before U.S. holiday
* Psychological barrier noted at $950/oz
* SPDR Gold Trust holdings rise to record above 980 tonnes
By Risa Maeda
TOKYO, Feb 16 (Reuters) - Gold extended losses on Monday as
investors booked profits from a recent rally to above $950 an
ounce, but metal's allure as a safe-haven asset remained as
uncertainty continues to cloud the global economic outlook.
Gold jumped to $951.80 on Feb. 12, its strongest since
July, on the back of an increase in demand from investors
seeking alternative investment to equities and other
conventional assets.
Spot gold <XAU=> was trading at $936.50 as of 0332 GMT,
down 0.3 percent from New York's notional close on Friday, when
it fell 0.8 percent.
"Given the U.S. holiday today, long liquidation is in
progress," said Shuji Sugata, manager at Mitsubishi Corp
Futures and Securities' research team.
"Speculators have now halted buying, the non-ETF sector,
such as the jewellery industry, has lost its appetite at the
current high level, and gold has a psychological barrier of
$950," he added.
The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust <GLD>, said its holdings hit a record 985.86
tonnes as of Feb. 13, up 15.29 tonnes, or 1.6 percent, from the
previous day. []
The holdings were up more than 200 tonnes this year.
In other markets, the yen rose against other major
currencies on Monday after finance ministers from the Group of
Seven (G7) made no specific reference to strength in the
Japanese currency at a weekend meeting.
The euro fell against the dollar amid signs of further
weakness in the euro zone economy.
OECD Secretary General Angel Gurria said in an interview
with Reuters on Saturday the Organisation for all Economic
Cooperation and Development would cut its forecasts for the
30-nation OECD bloc and for large emerging economies when it
issues new projections at the end of March. []
But a weakening in the euro versus the dollar has had
little impact on gold, traders said.
A fall in the euro is traditionally negative to gold, which
is often seen as an alternative to the U.S. dollar. But gold
has now been in favour as investors would rather avoid the
volatile European single currency.
"A positive correlation between gold and the euro has been
lost. Especially this month, it is clear that the two are
negatively correlated. That's because a fall in the euro
underlined investor worries over unstable outlook of the global
economy," Sugata said.
In the long run, traders say, gold is a buy as there are
inflation concerns given the large amounts of money being
pumped into the global economy by central banks and governments
to boost growth and confidence.
Investors expecting years of inflation and global economic
instability are pouring money into securities backed by gold
bullion, helping to turn a simple safe haven into a mainstream
asset class. []
Speculative gold players in the non-commercial category
boosted their net long positions to 163,622 lots on gold
futures traded on COMEX at Feb. 10, up from 155,306 net long
lots at Feb. 3.
Precious metals prices at 0332 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 936.50 -2.90 -0.31 12.47
Spot Silver 13.53 -0.09 -0.66 -8.40
Spot Platinum 1058.00 -1.50 -0.14 -30.39
Spot Palladium 212.00 -2.00 -0.93 -42.39
TOCOM Gold 2772.00 11.00 +0.40 -9.41
14460
TOCOM Platinum 3117.00 -8.00 -0.26 -41.62
3906
TOCOM Silver 395.00 4.10 +1.05 -26.99
154
TOCOM Palladium 634.00 -3.00 -0.47 -53.07
56
Euro/Dollar 1.2774
Dollar/Yen 91.54
Spot in $ per ounce, TOCOM prices in yen per gram, except
TOCOM silver which is priced in yen per 10 grams.
(Additional reporting by Miho Yoshikawa: Editing by Sambit
Mohanty)
