SINGAPORE (Reuters) - Gold steadied above $1,280 an ounce on Monday after posting its biggest monthly gain in three years in the prior session following weaker-than-expected U.S. economic growth in the fourth quarter.
Bullion is likely to maintain its safe-haven appeal amid renewed concerns over the global economy with data showing China's factory sector shrinking for the first time since 2012.
FUNDAMENTALS
Spot gold was off 0.2 percent at $1,280.77 an ounce by 0036 GMT after rising 2 percent on Friday. It ended January with a gain of 8.4 percent, its largest monthly increase since January 2012.
U.S. gold for April delivery rose 0.2 percent to $1,281.60 an ounce.
U.S. economic growth slowed to a 2.6 percent annual pace from a 5 percent rate in the third quarter as weak business spending and a wider trade deficit offset the fastest pace of consumer spending since 2006.
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China's factory sector unexpectedly shrank for the first time in nearly 2-1/2 years in January and firms see more gloom ahead, raising expectations that policymakers will take more action to forestall a sharper slowdown.
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U.S. Mint American Eagle gold coin sales in January rose from December but were the lowest for that month since 2008, as a rally in prices discouraged collector buying in what is typically a period of peak demand.
MARKET NEWS
The yen rose while commodity currencies softened as worries about the health of the Chinese economy dealt a fresh blow to sentiment already unsettled by a selloff on Wall Street. Asian shares got off to a downbeat start. [USD/] [MKTS/GLOB]
Oil prices fell as unions called a strike at U.S. oil and chemical plants on the weekend, cutting some of the gains made late last week when prices roared more than 8 percent on a sharp drop in U.S. drilling.
(Reporting by Manolo Serapio Jr.; Editing by Ed Davies)