Reuters reported that Gold edged up extending its winning streak into a seventh session as dimming prospects for global growth support expectations of more stimulus measures from central banks around the world.

Further monetary easing would likely boost inflation, driving investors to gold as it is seen as a good hedge against rising prices. Data earlier on Monday showed Japan's economic growth slowed much more than expected in the second quarter, after a string of figures on Friday suggested that China's pro-growth measures have been insufficient.

Mr Dominic Schnider an analyst at UBS Wealth Management in Singapore said that "The sentiment on gold has gotten better in the past few days with investors focusing on central banks. Gold could test its 200 day moving average near USD 1,650 around the US Federal Reserve symposium, slated to take place late this month in Jackson Hole, Wyoming and expected to shed light on the central bank's attitude towards further stimulus.

Spot gold gained 0.2% to USD 1,622.08 an ounce by 0639 GMT after posting a weekly rise of nearly 1%. The US gold futures contract for December delivery inched up 0.1% to USD 1,625.

Data from the US Commodity Futures Trading Commission showed that hedge funds and money managers cut their net long position in US gold futures and options by 11% in the week to August 7th 2012 following 35% surge in the previous week.

Gold's premium to platinum rose to an all time high above USD 230 an ounce, as platinum remained under pressure from gloomy economic prospects. Gold has been at an average USD 194 discount to platinum since January, 1985.

Prices of spot platinum, mainly used to produce autocatalyst and jewellery, traded nearly flat at USD 1,393.80 after falling for 6 weeks in a row. So long as the global economy does not show signs of improvement and platinum supply does not undergo dramatic cuts, platinum's suffering is likely to continue and the spread could widen further.

Source - Reuters

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