Gold Rebounds as Safe-Haven Allure Stays

By: Reuters

Spot gold rebounded as much as 0.8 percent from a sharp slide off the record high in the previous session, as the metal's appeal remained undimmed to investors keen to seek safety during a period of heightened worry about the euro zone's debt crisis.  
      

Jose Luis Pelaez | Iconica | Getty Images

Spot gold [XAU=  1846.89    -17.52  (-0.94%)   ]traded up 0.6 percent to $1,874.89 an ounce by 0033 GMT, easing from an intra-day high of $1,879.69. It hit a record high of $1,920.30 then slid as much as $60 in the previous session.

U.S. gold [GCCV1  1845.00    -28.30  (-1.51%)   ]gained 0.3 percent to $1,877.90, off the all-time high of $1,923.7 struck on Tuesday. 

Gold tumbled on Tuesday after the Swiss National Bank shocked the market by setting an exchange rate cap on the soaring franc, discouraging investors to use the currency as a safe haven.

The strong rebound in gold showed that appetite for the precious metal has hardly been dented, as investors anxious about euro zone's fiscal health are appear to take advantage of the price dip to build up positions.

The dominant U.S. services sector picked up steam unexpectedly last month, snapping a three-month streak of slower growth, though a slower pace of hiring underscored concerns about the broader job market.

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Holdings in the world's largest gold-backed exchange-traded fund, SPDR Gold Trust [GLD 182.90    -0.338  (-0.18%)   ], have not changed since Aug. 30, at 1,232.314 metric tons.

Wall Street fell for a third day on Tuesday on fears Europe still has failed to tackle its debt crisis, prompting worries the market is headed to new lows for the year.

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