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By Bloomberg

Gold held the biggest weekly gain in almost two months as concern about slowing growth in emerging markets spurred demand for a haven.

China’s shock devaluation of its currency last week focused investors’ minds on frailties in other emerging markets. The MSCI Emerging Markets Currency Index retreated to near a five- year low on Monday while a gauge of developing market stocks fell to the lowest since 2011. Bullion futures added 0.3 percent even as the dollar rose against major peers.

Gold climbed 1.7 percent last week after China weakened the yuan in a move that supports exports, triggering fears of competitive currency devaluations. The metal is still heading for a third straight annual loss. While billionaire Stan Druckenmiller bought gold through the largest bullion-backed fund in the second quarter, hedge-fund manager John Paulson cut his holdings for the first time in two years.

“When we see this type of churn in emerging market currencies, both the dollar and gold tend to gain,” Jonathan Butler, a precious metals strategist at Mitsubishi Corp. in London, said by phone. “The Druckenmiller news may have outweighed the Paulson selling in terms of sentiment.”

Gold for December delivery traded at $1,116.20 an ounce by 7:51 a.m. on the Comex in New York, where volume was 37 below the 100-day average for the time of day. The price rebounded 3.9 percent since reaching a five-year low on July 24. Bullion for immediate delivery added 0.2 percent to $1,116.99, according to Bloomberg generic pricing.

Gold’s Decline

Prices have fallen as the dollar strengthened and Federal Reserve officials signaled they plan to raise interest rates soon, reducing the metal’s allure because it doesn’t pay interest or give returns like other assets such as equities and bonds.

Druckenmiller, the former chief strategist for George Soros, bought shares of the SPDR Gold Trust valued at $323.6 million in the second quarter, according to a filing with the Securities and Exchange Commission. Paulson, once one of the best known gold bulls, cut his stake by almost 10 percent.

Investors are holding close to the least through exchange- traded products since 2009, data compiled by Bloomberg show.

Silver for September delivery was little changed at $15.205 an ounce in New York. Platinum for October lost 0.1 percent to $993.10 an ounce and palladium for September was down 0.6 percent at $613.55 an ounce.