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Gold steadies near US$1,800 on virus fears, US-China spat
[BENGALURU] Gold steadied near the US$1,800 level on Friday after a sharp fall in the previous session, as worries over surging coronavirus cases and US-China tensions underpinned its safe-haven appeal, although a stronger US dollar capped gains.
Spot gold was up 0.1 per cent at US$1,797.52 per ounce by 2.48am GMT (10.48am SGT). US gold futures eased 0.1 per cent to US$1,797.30.
"Gold is being held up due to rising geopolitical uncertainty, and a resurgence of coronavirus cases in the United States as well as across the world. However, a stronger USD has kept gold in check," National Australia Bank economist John Sharma said.
The US dollar held firm against its rivals, also benefiting from safe-haven inflows.
The United States reported at least 70,000 new Covid-19 cases on Thursday, a record daily increase for the seventh time this month, according to a Reuters tally.
New York Fed president John Williams said it could take a few years for the US economy to recover from the damage caused by the pandemic, and it was not yet the time to think about raising interest rates.
"The bull's case for gold remains intact with real rates low and suppressed and which would be able to sustain the high price of gold. But with prices at yearly highs, buying the dips probably works out best for most traders as a trading strategy," Phillip Futures said in a note.
Lower US interest rates increase the appeal of non-yielding bullion.
Markets also kept a wary eye on China's trade relations with the US, with Washington considering a ban on travel to the US by all members of the Chinese Communist Party and their families, a person familiar with the matter said.
Elsewhere, palladium dropped 1.3 per cent to US$1,970.52 per ounce, while platinum was steady at US$824.17. Silver fell 0.6 per cent to US$19.05, but was on track for a sixth consecutive weekly rise.