Gold eased from an over one-week peak on Friday as risk sentiment improved on hopes of global measures to soften the impact of the coronavirus outbreak, but a surge in new cases capped bullion’s losses and kept it on track for a weekly gain.
Spot gold was down 0.1% at $1,574.69 per ounce as of 0427 GMT, having touched its highest since Feb. 4 at $1,577.89 earlier in the session.
U.S. gold futures also slipped 0.1% to $1,577.80.
“Equities market has shrugged off the bearish sentiment and has started to move higher as investors are reassessing the potential (economic) impact of the virus,” Margaret Yang Yan, a market analyst at CMC Markets said, adding that a strong dollar is also pressuring bullion.
Asian shares were on course to post their second straight week of gains, while the U.S. dollar, which has also seen steady interest as a safe haven amid fears over the virus, rose to a more-than four-month high against key rivals.
However, analysts said interest in gold remained intact as the death toll in China’s Hubei province rose by 116, with the total number of cases up by nearly 5,000.
The safe-haven metal has risen by about 0.3% so far this week.
Expectations that the virus could hurt the global economy as well as easy monetary policy from central banks are keeping gold attractive in the market, CMC’s Yan said.
Investors were now looking out for U.S. retail sales and consumer confidence numbers due later on the day.
“The U.S. consumer is really the biggest piece of global growth at this point with China getting a hit due to the trade war and the virus, Europe is still sluggish,” said Ilya Spivak, a senior currency strategist at DailyFx.
Gold is often used as a safe store of value during times of political and financial uncertainty.
Elsewhere, palladium rose 0.6% to $2,438.78 per ounce, silver gained 0.1 % to $17.65, while platinum was up 0.3% at $970.92.
Reporting by K. Sathya Narayanan in Bengaluru; Editing by Arun Koyyur
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