London: Gold edged down from the previous day’s 12-week high on Wednesday as a rout in other commodities pressured the metal and Asian buying slackened, though volatility in the wider markets lent support as investors sought a haven from risk.

Commodities and stocks fell sharply on Wednesday after the World Bank cut its growth forecasts for 2015 and 2016, fuelling fears that the benefits of cheaper oil may be offset by anaemic growth and the threat of deflation.

Spot gold was down 0.1 per cent at $1,229.70 (Dh4,516) an ounce at 1028 GMT, while US gold futures for February delivery were down $5.00 an ounce at $1,229.40.

Spot prices hit a 12-week high at $1,243.60 an ounce on Tuesday as turmoil in the wider financial markets sent investors scurrying for assets seen as lower risk, like the Japanese yen, US and German bonds, and bullion.

The metal came under pressure on Wednesday however as the commodities sector was hit by heavy selling. A failure to break decisively above the $1,245 an ounce level has also taken some wind out of gold bulls’ sails, technical analysts said.

“On the upside, when you get up to $1,240-$1,250, gold runs out of steam,” ABN Amro analyst Georgette Boele said. “The bulls tried to push it higher, but at the same time, there are people who are interested in selling.

“At the moment, there’s a fight between two camps. The whole risk sentiment issue is giving support, [but] lower inflationary pressures are not good for gold.”

Falling raw materials prices are seen as easing inflation pressures.

Oil prices fell more than one per cent after hitting a near six-year low on Tuesday, while copper slid six per cent.

In the physical bullion markets, buyers turned cautious in Asia after gold failed to hold on to the previous session’s highs.

Premiums in top consumer China fell to around $3 an ounce over the global benchmark from $4-$5 in the previous session.

“Shanghai...was not attracting a lot of attention today, so the intraday longs quickly began covering positions and putting pressure on the metals,” precious metals house MKS said in a note. “Gold subsequently fell through $1,230, drawing out a light round of intraday stops and touching the day’s low.”

Among other precious metals, silver was down 2.2 per cent at $16.63 an ounce, giving up the bulk of the previous session’s hefty gains. Spot platinum was down 0.7 per cent at $1,225.80 an ounce, while spot palladium was down 3.2 per cent at $786.80 an ounce.