People are reluctant to take risk and the future seems quite uncertain... Gold gives you that sense of protection right now because we're going into this period," said Phil Streible, chief market strategist at Blue Line Futures in Chicago.
The novel coronavirus, which has infected over 4.46 million people and killed 301,445, has hammered global economic activity, prompting central banks and governments to unleash massive stimulus measures.
Gold tends to benefit from economic stimulus because it is widely viewed as a hedge against inflation and currency debasement.
Though many governments have started easing restrictions, the move has rekindled concerns of a second wave of infection.
"Given all of this chaos and confusion, it is hardly surprising that gold ETFs are seeing an unchanged high level of buying interest," analysts at Commerzbank
said in a note.
"If speculators were now to jump on the bandwagon too, gold would rise quickly towards the $1,800 mark."
SPDR Gold Trust holdings, the world's largest gold-backed exchange-traded fund, jumped 1.2% to 1,104.72 tonnes on Thursday - its highest in more than seven years.
Elsewhere, palladium climbed 1.9% to $1,870.28 per ounce, but was on track to post its seventh straight weekly drop.
Platinum rose 3.2% to $792.24 per ounce, having hit a high since March 13 at $796.
Silver was 4.3% higher $16.55. It touched a more than two-month peak of $16.71 earlier.
(Reporting by Eileen Soreng in Bengaluru; Editing by David Gregorio)