* Stocks set for worst losing streak since 2013
* U.S. Q3 economic growth slows less than expected
* Palladium slips off record highs hit on Tuesday (Updates prices, adds comments, details)By Swati VermaBENGALURU, Oct 26 (Reuters) - Gold prices rose on Fridaytowards the three-month highs hit earlier this week as nervousinvestors retreated from stock markets and piled into theprecious metal seen as a refuge from financial turmoil.Spot gold was up 0.3 percent at $1,235.16 an ounce at1346 GMT having earlier this week hit $1,239.68, its highestsince mid-July. It is on course for a fourth week of gains. U.S.gold futures rose 0.4 percent to $1,237.6 an ounce.
Global stocks slid again on Friday and were set to posttheir worst weekly losing streak in more than five years. "The confusion in bond and stock markets is fuelling someinterest in gold. If they continue to fall, that will givesupport to gold. You'll then have trend buyers coming in andsupporting the price," said Alasdair Macleod, head of researchat GoldMoney.com."The bears are frightened of being caught on the wrong side.The liquidation of short positions on COMEX has the potential inthe short term to drive gold up to between $1,260 and $1,270."
Gold prices have gained more than 6 percent after falling to$1,159.96 an ounce in mid-August, their lowest since Jan. 2017.
The release of U.S. growth data earlier, which showed theeconomy slowed less than expected in the third quarter, hadlittle lasting impact. "Gold prices ticked down a little after the GDP report, butpopped back up later," said Kitco Metals senior analyst JimWyckoff. "We are also seeing some more short-covering in thefutures markets which is lifting prices."Investor flows into bullion, often considered a safe havenand store of value during times of financial, economic andgeopolitical uncertainties, can be seen by the rise in holdingsof physically-backed exchange traded products.Holdings in the world's largest gold-backed exchange-tradedfund, SPDR Gold Trust , saw outflows of about 4.5 millionounces between late April and early October. But now at 24.1million ounces, holdings are at their highest since the end ofAugust. "Gold's impressive performance of late, coming amid U.S.dollar strength, suggests that gold finally is behaving like asafe-haven asset," Societe Generale analyst Robin Bhar said in anote.
A higher U.S. currency typically means dollar-priced goldbecomes more expensive for holders of other currencies, whichpotentially would weigh on demand.Among other precious metals, palladium was down 0.1percent at $1,098.60 an ounce, pulling further away from arecord high of $1,150.50 an ounce reached earlier this week.Silver was up 0.2 percent at $14.64 per ounce, andplatinum rose 0.7 percent to $828.40 an ounce. (Reporting by Swati Verma in Bengaluru; Editing by KirstenDonovan and Emelia Sithole-Matarise)
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