SINGAPORE, March 18 Gold rose above $1,600 for the first time in more than two weeks on Monday as an unusual bailout package for Cyprus threatened to trigger fresh turmoil in the euro zone, attracting investors to seek safety in gold. FUNDAMENTALS * Spot gold rose to a 2-1/2-week high of $1,608.30 an ounce earlier in the day, before easing to $1,600.96 by 0024 GMT, up 0.6 percent from the previous close. * U.S. gold also hit a 2-1/2-week high, at $1,607.6 an ounce, and pared some gains to $1,600.10. * The euro zone agreed on Saturday to hand Cyprus a bailout worth 10 billion euros ($13 billion), but forced the country's depositors to pay up to 10 percent on their savings despite the risk of a wider run on savings. * Investors will closely watch a U.S. Federal Reserve policy meeting on Tuesday and Wednesday to assess the central bank's attitude towards aggressive monetary stimulus. Economists expected the Fed to keep buying bonds for the rest of the year to aid the still frail economic recovery. * Speculators raised net long positions in U.S. gold by 9 percent in the week to March 12 from a more than five-year low of 39,631 contracts to 43,195 contracts, data from U.S. Commodity Futures Trading Commission showed. * But speculators' short positions in gold continued to increase, up nearly 2 percent from a week earlier to 70,126 contracts, the highest since at least 2006. * Holdings of SPDR Gold Trust, the world's biggest gold-backed exchange-traded fund, fell 3.311 tonnes to 1,232.996 tonnes on Friday, the lowest since October 2011. * For the top stories on metals and other news, click , or MARKET NEWS * U.S. stocks slipped on Friday, ending the Dow Jones industrial average's longest winning streak since 1996 as investors paused just below the S&P 500's record high. * The euro skidded lower in Asia on Monday as surprise news that Cyprus would have to tax depositors as part of a bailout plan was taken as setting a dangerous precedent that at worst could ultimately risk bank runs elsewhere in the region. DATA/EVENTS (GMT) 1000 EZ Eurostat trade nsa, EUR Jan 2013 1400 U.S. NAHB housing market indx Mar PRICES Precious metals prices 0024 GMT Metal Last Change Pct chg YTD pct chg Volume Spot Gold 1600.96 9.12 +0.57 -4.39 Spot Silver 28.95 0.28 +0.98 -4.39 Spot Platinum 1578.99 -22.01 -1.37 2.87 Spot Palladium 758.97 -9.03 -1.18 9.68 COMEX GOLD APR3 1600.10 7.50 +0.47 -4.52 13176 COMEX SILVER MAY3 28.92 0.07 +0.24 -4.33 2755 Euro/Dollar 1.2905 Dollar/Yen 94.94 COMEX gold and silver contracts show the most active months (Reporting by Rujun Shen; Editing by Himani Sarkar)
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