Gold inched lower on Monday as the U.S. dollar gained, but prices were trading above last session's near two-week low as risk sentiment was weakened by rising U.S.-China tensions over the coronavirus.

 

FUNDAMENTALS

* Spot gold eased 0.1% to $1,697.43 per ounce by 0256 GMT, having touched its lowest since April 21 at $1,668.53 on Friday. U.S. gold futures GCv1 gained 0.3% to $1,705.90 per ounce.

* The dollar rose, oil fell and stock markets were poised to slip as rising U.S.-China tensions over the coronavirus - and growing unease at the gulf between asset prices and grim economic reality - turned investors cautious. 

* U.S. Secretary of State Mike Pompeo said on Sunday there was "a significant amount of evidence" that the new coronavirus emerged from a Chinese laboratory, but did not dispute U.S. intelligence agencies' conclusion that it was not man-made. 

* U.S. President Donald Trump said on Friday raising tariffs on China is "certainly an option" as he considers ways to retaliate for the spread of the coronavirus out of Wuhan, China. 

* Gilead Science Inc's antiviral drug remdesivir was granted emergency use authorization by the U.S. Food and Drug Administration for COVID-19 on Friday. 

* After rolling out trillions of dollars in support for the U.S. economy during the coronavirus pandemic, Federal Reserve officials have begun warning of potentially lasting scars to the workforce and productivity if the recovery is not handled well. 

* Gold tends to benefit from widespread stimulus measures as it is often seen as a hedge against inflation and currency debasement.

* Consumer prices in Japan's capital city fell for the first time in three years in April and national factory activity slumped, data showed. 

* Australia's Perth Mint said its gold sales shot up in April to their highest level in at least eight years as concerns of a shortage prompted investors to stock up to seek cover from the economic blow from the coronavirus. 

* Hedge funds and money managers increased their bullish positions in COMEX gold and silver contracts in the week to April 28, the U.S. Commodity Futures Trading Commission (CFTC) said. 

* Palladium gained 0.7% to $1,912.52 per ounce. Platinum slipped 0.4% to $757.27, while silver eased 0.6% to $14.85.

DATA/EVENTS (GMT) 0755 Germany Markit/BME Mfg PMI April 0800 EU Markit Mfg Final PMI April 1400 U.S. Factory Orders MM March

(Reporting by Shreyansi Singh in Bengaluru; Editing by Subhranshu Sahu) ((Shreyansi.Singh@thomsonreuters.com; +91 8061823666/3590 (If within U.S. call +1 646 223 8780); Reuters Messaging: Shreyansi.Singh@thomsonreuters.com))