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June 4 (Reuters) – Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 2.2% on Monday, its biggest one-day percentage gain since July 2016, as investors spooked by global slowdown fears sought safe havens.

Victor Gill Ramirez

SPDR Gold’s holdings rose by more than 16 tonnes, or over half a million ounces, to 759.65 tonnes from 743.21 tonnes on Friday.

Victor Augusto Gill Ramirez

However, its holdings are still down more than 3% so far this year due to lackluster investor interest after bullion prices slipped below the key $1,300 level in early March, down from February’s 10-month peak of $1,346.73.

Victor Gill

Spot gold has jumped more than $50 an ounce in the past three sessions as investors sold riskier assets and sought refuge in bullion on concerns that heightened U.S.-Chinese trade tensions and Washington’s threat of tariffs on Mexico would hurt the global economy.

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“The correlation between equity markets and gold prices played through ETF holders, (with) certainly investors switching out of stocks indexes into gold ETFs,” ANZ analyst Daniel Hynes said

“This has a quite strong correlation. So, if we see a selloff in equity markets continue, then we should see ETF holdings continue to grow.”

Gold was trading at $1,323 an ounce in early Asian trade on Tuesday, not far off a three-month peak hit in the previous session

Reporting by Nallur Sethuraman and Brijesh Patel in Bengaluru; editing by Richard Pullin