NEW YORK, Aug 11: Gold bounced more than 2 per cent on Friday on safe-haven buying and as the Federal Reserve pumped money into the banking system to provide liquidity in the financial markets after Thursday's tumultuous sell-off.

People are more interested in gold in case the Fed does do something more dramatic if the market does deteriorate a little bit more, then gold should do well, said Caesar Bryan, portfolio manager of the $450m GAMCO Gold Fund in New York.

Gold rose as high as $676.50 an ounce after earlier falling to $658.10, the lowest since July 27. It was at $672.20/673.00 at 2:35 p.m., up sharply from $661.20/ 662.00 late in New York.

—Reuters