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Gold set for third straight weekly gain as virus cases soar
· Gold prices were headed for their third consecutive weekly gain on worries about rising global cases of the novel coronavirus, although prices see-sawed on Friday after a firm dollar and a gain in equities countered safe-haven demand.
· Spot gold was steady at $1,760.73 per ounce as of 0339 GMT. The bullion has risen more than 1% so far this week, with prices scaling a near eight-year high of $1,779.06 on Wednesday. U.S. gold futures rose 0.2% to $1,770.90.
· “The amount of money pumped in by governments definitely supports gold as a safe haven with this COVID-19 situation still around,” said Brian Lan, managing director at Singapore dealer GoldSilver Central, amid low interest rates globally.
But gold is seeing some profit-taking after almost reaching the $1,780 mark due to the overall strength of the dollar and stocks, Lan added.
· The dollar has pared a large part of this week’s losses.
· Asian stock markets ground higher, but are set to end the week little changed as surging Covid-19 infections offset encouraging economic data.
Cases have been rising across the United States, while over 9.51 million people have been infected globally, according to a Reuters tally.
· Bank of Japan Governor Haruhiko Kuroda said second-round effects of the pandemic could hurt its economy “considerably”, signalling the bank’s readiness to ramp up stimulus again.
· Lower interest rates and stimulus measures tend to benefit gold, viewed as a hedge against inflation and currency debasement.
· “Given the macro backdrop, sentiment in the gold market is positive, and this is illustrated in the continual increase in exchange-traded fund holdings,” said ING analyst Warren Patterson.
· Holdings of the SPDR Gold Trust ETF stood at more than seven-year highs.
· Palladium gained 0.3% to $1,847.05 per ounce, but was heading for its worst week since May 1.
· Platinum was flat at $803.52. Silver fell 0.9% to $17.71.