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Gold up 1 pct, set for best month in four years


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PRECIOUS-Gold up 1 pct, set for best month in four years

* Gold up 10.4 pct in February for biggest gain in four years

* SPDR fund inflows touch one-year high (Updates throughout, changes dateline from SINGAPORE)

By Clara Denina

LONDON, Feb 29 Gold rose 1 percent on Monday, boosted by lower European shares and a softer dollar, leaving the metal well placed to log its best monthly performance in four years as turmoil in wider markets increased its safe-haven appeal.

Spot gold rose to $1,233.58 an ounce by 1053 GMT, while U.S. gold for April delivery was up 1.2 percent at $1,234.40. Prices gained 10 percent in February, their biggest monthly jump since January 2012.

Bullion has rallied about 15 percent this year, rediscovering its role as a shelter for risk-averse investors in the face of tumbling equities and fears of a global economic slowdown.

Gold hit a one-year high of $1,260.60 this month, further supported by the repricing of expectations for U.S. interest rate rises.

"Coming into March, technical indicators look fairly solid and the ETF movements look quite supportive," said Mitsubishi Corp strategist Jonathan Butler.

"On the macroeconomic side, however, next week we are going to have the ECB announcement of possible further quantitative easing, which is going to weigh on the euro against the dollar and all commodities should come under pressure again."

The European Central Bank (ECB) will hold a monetary policy meeting on March 10. President Mario Draghi has said that the bank would review and possibly recalibrate its stance to fight persistently low inflation. Markets are now pricing in at least two rate cuts.

European shares fell after a weekend meeting of the G20 group of leading economies failed to strike new measures to boost growth.

"Gold still shines as a safe haven in the current equity rout," OCBC Bank said in a note, adding that higher hurdles for the U.S. Federal Reserve to increase rates three times this year would help to keep prices above $1,200.

Hedge funds and money managers raised their bullish stance in COMEX gold to a one-year high in the week to Feb. 23, U.S. Commodity Futures Trading Commission data showed on Friday.

Assets in SPDR Gold Trust, the world's top gold-backed exchange-traded fund, rose to 762.41 tonnes on Friday, the highest in about a year.

Gold prices on the Shanghai Gold Exchange were at a premium of about $2 an ounce, indicating buying interest from top consumer China.

Physical demand in India, however, remained subdued last week, with the market falling to record discounts as consumers postponed purchases on expectations of a cut in import tax when the government presents its annual budget on Monday.

Among other precious metals, platinum rose 0.9 percent to $918.85 an ounce, while silver gained 0.7 percent to $14.81 and palladium climbed 3 percent to $495.25. (Additional reporting by A.Ananthalakshmi in Singapore; Editing by David Goodman)