Bullion climbed this year to the highest level in three months as signs the U.S. economy wasn’t recovering in line with expectations boosted demand for a haven. The more bullish view from UBS contrasts with outlooks from Societe Generale SA and Goldman Sachs Group Inc., which expect the metal to falter as the Federal Reserve presses on with cuts to stimulus. Gold slumped 28 percent in 2013 as investment holdings contracted.
“Gold has started to shed its stigma, if slowly,” Tully and Teves wrote in yesterday’s report. “Over the past thirteen months gold was either the favorite asset to short or to ignore completely. Recent developments, however, suggest that this is no longer the case, and momentum is returning.”
Gold for immediate delivery gained 0.3 percent to $1,315.72 at 5:22 p.m. in London. Prices rose to $1,332.45 on Feb. 18, the highest since Oct. 31, and are headed for a second monthly climb. This year, bullion is up 9.1 percent as the MSCI All-Country World Index of equities lost 0.9 percent.
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