As equities dropped bullion metal gold moved towards $1,100. This is due to investor holdings jumped to the high level in two months.
Bullion for immediate delivery advanced as much as 0.7 percent to $1,095.07 an ounce and traded at $1,093.59.
The boisterous start to the year on global financial markets has led investors to seek more bullion, boosting prices 3.1 percent. Asian stocks fell to a three-year low on Wednesday after crude sank below $28 a barrel and the International Monetary Fund(IMF) cut its world growth outlook.Citigroup upgraded its gold price forecast for 2016, while cutting the bank’s outlook for crude oil and base metals as economic growth cools.
Gold’s safe-haven rationale is back in vogue, for the time being.
Holdings in gold-backed exchange-traded products climbed for the seventh time in eight sessions. Assets surged 22.7 metric tons to 1,511.8 tons as of Tuesday, the highest level since Nov. 6.
People are still a bit nervous, although think they should be because they feel that this commodity cycle is starting to position itself quite positively.
Bullion of 99.99 percent purity rose 0.4 percent to 232.30 yuan a gram ($1,097.76 an ounce) on the Shanghai Gold Exchange. Spot silver added 0.5 percent, while palladium lost 0.1 percent and platinum dropped 0.6 percent.