Gold’s been beaten up for months, sinking to the lowest level since 2010 in July, as investors cut holdings in favor of other assets and the dollar jumped. China’s progressive devaluation may be helping turn the tide.

The precious metal held the biggest one-day gain in three months on Thursday to trade near a three-week high on concern that the market turmoil triggered by China’s move may weaken currencies and even delay the onset of higher U.S. interest rates. Yuan-denominated bullion was little changed in Shanghai.

Investors are “returning back to the safety of gold amid market concerns around a potential currency war,” Australia & New Zealand Banking Group Ltd. said in a report. “Emerging markets are going to come under even more pressure from China’s yuan move; volatility is rising. Buckle up.”

Gold sank for a second straight year in 2014 and extended losses in the first half as signs of recovery in the U.S. lifted equities, boosted the dollar and prompted the Federal Reserve to lay the groundwork for higher rates. China’s decision this week to weaken its currency may boost the chances of competitive devaluations, reinvigorating bullion’s allure as a store of value. The dollar dropped on Wednesday as traders pared bets that the Fed will start to tighten policy from next month.

Gold for immediate delivery was little changed at $1,121.40 an ounce at 3:07 p.m. in Singapore after rising as much as 0.2 percent to $1,126.89, the highest price since July 20, according to Bloomberg generic pricing. The metal jumped 1.4 percent on Wednesday, the most since May 13.

Reference Rate

China’s yuan reference rate fell for a third day on Thursday, widening the scope for declines in the currency of Asia’s top economy. The fixing dropped 1.1 percent, after slides of 1.6 percent and 1.9 percent in the last two days.

Gold of 99.99 percent purity rose as much as 0.7 percent to 233.80 yuan a gram, the highest since July, and traded at 232 yuan on the Shanghai Gold Exchange. Prices surged 3.2 percent on Wednesday after a 2.3 percent advance the day before.

Silver for immediate delivery fell 0.9 percent to $15.411 an ounce. Spot platinum lost 0.4 percent to $996.50 an ounce after rising 1.4 percent on Wednesday, while palladium dropped 0.4 percent to $624.65 an ounce after a 4.4 percent surge.