PRECIOUS-Gold hits 3-1/2 month high on weak dollar, U.S. growth fears

* Spot gold up for 3rd session; futures rise for 9th session

* Silver at highest level since early November

* Dollar index at six-week low

(Updates throughout, changes dateline from SINGAPORE)

LONDON, Feb 17 (Reuters) - Gold hit a 3-1/2 month high on Monday as fears over U.S. economic growth after a series of disappointing data sent the dollar to a six-week low, lifting demand for the metal.

Spot gold touched its highest level since Oct. 31 at $1,329.55 an ounce earlier in the session and was trading up 0.7 percent at $1,326.88 by 1123 GMT. The metal posted its biggest weekly gain since August last week, up 4 percent.

U.S. gold futures climbed for a ninth session running, up 0.6 percent to $1,327.10 an ounce, and were on track for their longest rising streak since July 2011.

Gold has risen 10 percent this year, after a 28 percent drop in 2013 that snapped a 12-year run of gains.

Prices have been boosted by weak U.S. and Chinese economic data, while emerging market jitters have hurt some equity markets last month, spurring demand for bullion - usually seen as providing insurance in times of troubles.

But global shares have rebounded this month, unusually rising in tandem with gold. Investor risk appetite tends to diminish interest in gold.

"We have had a pause in selling off emerging markets, bond volatility has fallen ... so the traditional things which you would assume are taking place when gold is going bid because of its insurance component are not currently active and yet gold is being bought," said Sean Corrigan, chief investment officer at asset manager Diapason.

"The only traditional sort of signal that we have here to maybe explain the last couple of weeks pick-up is the fact that the dollar has been weaker."

The dollar hit a six-week low against a basket of currencies after U.S. manufacturing output data on Friday showed an unexpected fall in January.

Speculators raised their bets in gold futures and options to a three-month high, according to data from the Commodity Futures Trading Commission.

Regulatory filings also showed hedge fund Paulson & Co maintained its stake in the world's biggest gold-backed exchange-traded fund, SPDR Gold Trust, in the fourth quarter.

But investor confidence is not uniformly positive and holdings of the SPDR fund fell 5.10 tonnes to 801.25 tonnes on Friday - the first drop in three weeks. They have remained relatively stable over the past few weeks, compared with last year's 500-tonne outflow.

Analysts said that without any meaningful shift in investor sentiment and given the positive macroeconomic outlook, gold's rally may be short-lived.

"The question is how much further it can run ... it could be pushed towards the mid-1,400 but I have my doubts that we are back in a bull market," Corrigan said.


Gold premiums in India, the world's second-biggest consumer of the metal after China, recovered 21 percent from their four-month low as the federal government kept the import duty steady at a record 10 percent.

Premiums recovered to $75 an ounce on London prices from $62 an ounce on Friday, when they fell due to speculation over a cut in customs duty.

India's finance minister said on Monday that the government would look into relaxing gold imports curbs.

Buying in China picked up from Friday's levels. Premiums for 99.99 percent purity gold on the Shanghai Gold Exchange rose to about $7 from $5.50 on Friday, though volumes were lower.

Silver climbed to its highest level since November at $21.96 an ounce, before trading up 1 percent at $21.68. The metal has gained 12 percent since the start of the year.

Platinum was unchanged at $1,424.70 an ounce, while palladium gained 0.3 percent to $736.75 an ounce.

(Additional reporting by A. Ananthalakshmi in Singapore and Siddesh Mayenkar in Mumbai; Editing by Pravin Char)