Gold prices held near an eight-month high

Gold quarterly gain in more than two years, and has grown more than 10% after the Federal Reserve announced the third round of quantitative easing earlier this month.
At the end of the week gold was down against the strengthening dollar after U.S. data released showed that the purchasing managers index and the index of consumer sentiment fell more than expected, increasing the demand for riskier assets. The U.S. currency strengthened after the purchasing managers' index fell to Chicago for the first time in three years below 50, indicating contraction.
Reserves of gold in exchange-traded funds, which issue securities backed by physical metal, fell from record highs, which were recorded by nearly 340,000 ounces.
Demand in India, which is a major consumer of gold, remains weak, as higher interest rates reduce the metal.
Data from the International Monetary Fund showed that South Korea has increased its gold reserves by almost 16 metric tons (17.63 tons) in July, along with Paraguay, which has increased its reserves in July, from a few ounces to more than 8 tons.
So far this year, central banks have increased their holdings to 262.1 tons, compared to 203.39 tonnes in the first eight months of 2011.
At the same time, Turkey raised its reserves to 100.2 tonnes in the first eight months of the year, and Russia at 53.75 tons.
Private investors also added to their gold reserves through exchange-traded funds, with the support of physical metal to a record 74.06 million ounces.