By Jan Harvey
LONDON (Reuters) - Gold hit a three-month high on Monday, rising for a fifth session, as a run of soft U.S. data supported expectations that the Federal Reserve will hold off raising interest rates for the time being.
Spot prices rose 3 percent last week, their biggest weekly climb in four months, after recent downbeat readings of the U.S. jobs market, retail sales and consumer sentiment led analysts to conclude that an imminent rate increase was unlikely.
That took some pressure off gold. An increase in rates would raise the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.
Spot gold was up 0.1 percent at $1,223.60 an ounce at 1352 GMT, while U.S. gold futures for June delivery were down $2.20 an ounce at $1,223.10.
"The U.S. data has been a lot weaker than expected, which has calmed investors who had been expecting a June or July rate hike," Capital Economics analyst Simona Gambarini said. "We're of the view that September is the most likely date when the Fed will raise rates. If the data continues to be weaker, we would expect gold to react quite strongly."
Gold hit a peak at $1,232.20, its highest since mid February, earlier in the day, but pared gains as the dollar rose nearly 1 percent against the euro, rebounding from last week's near four-month low.
Investors are awaiting minutes of the Fed's April policy meeting, due on Wednesday, for clues on the U.S. central bank's opinion on the economy and when it could raise rates.
Hedge funds and money managers increased net long positions in silver and gold in the week ended May 12, U.S. Commodity Futures Trading Commission data showed on Friday.
Hedge fund Paulson & Co kept its stakes unchanged in most of its gold investments in the first quarter, a filing with the U.S. Securities and Exchange Commission showed.
Silver was up 0.4 percent at $17.57 an ounce, while platinum was up 0.3 percent at $1,166.74 an ounce and palladium was up 0.4 percent at $793.70 an ounce.
As the annual industry gathering Platinum Week began in London, the World Platinum Investment Council said in a report it expected the platinum market deficit to shrink this year.
Norilsk Nickel and other investors aim to complete a purchase of palladium from Russia's central bank, which it outlined last year, by the end of 2015, deputy chief executive Pavel Fedorov said.
(Additional reporting by A. Ananthalakshmi in Singapore; Editing by Ahmed Aboulenein and Pravin Char)
