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Gold holds steady as virus fears offset gains in equities

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Gold prices were little changed on Friday as worries over an accelerating number of coronavirus cases countered a fillip to risk sentiment from positive US and Chinese economic data.

[BENGALURU] Gold prices were little changed on Friday as worries over an accelerating number of coronavirus cases countered a fillip to risk sentiment from positive US and Chinese economic data.

Spot gold was mostly unchanged at US$1,775.06 per ounce by 1.40pm EDT (1740 GMT).

Most US markets are closed on Friday ahead of Independence Day on July 4.

US gold futures edged down 0.2 per cent to US$1,787.30 per ounce.

"Central bank easing policies and uncertainty surrounding the second wave (of Covid-19) are sustaining gold prices," Bank of China International analyst Xiao Fu said, adding that despite a positive US jobs report, more data was needed to suggest the economy was on a strong footing.

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Gold will likely trade in a tight range, but remains well supported above US$1,750 an ounce, Ms Fu said.

Cases of coronavirus continued to increase globally, with more than 10.9 million people infected, while the United States reported a new daily global record number of cases.

"Geopolitical considerations are also to the fore," said Jeffrey Halley, a senior market analyst at Oanda.

"With a holiday in the United States, and the weekend upon us, some haven-directed buying of gold is definitely evident."

Escalating political tensions, more than 75 members of the US Congress sent a letter to President Donald Trump urging him to make a formal determination on whether China's treatment of Muslim Uighurs and other groups constituted an atrocity. Indicative of sentiment, holdings of the SPDR Gold Trust, rose 0.8 per cent to 1,191.47 tonnes on Thursday.

But stemming gains in bullion, data showing a recovery in China's services sector and a record addition of jobs to the US economy in June helped world shares hover near a four-month high.

Palladium rose 0.4 per cent to US$1,909.27 per ounce, while platinum climbed 0.8 per cent to US$809 per ounce, set for its first weekly gain in six.

Silver gained 1 per cent to US$18.07 per ounce, heading for its fourth consecutive weekly gain.

REUTERS

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