(Adds graphic, updates prices)
* Silver gains after last session's steep fall
* Platinum edges higher from two-month low
* U.S. 10-yr Treasury yields hit record low on Tuesday
* Coronavirus interactive graphic: https://tmsnrt.rs/2GVwIyw
By Shreyansi Singh
Feb 26 (Reuters) - Gold prices rose on Wednesday after a
sharp drop in the previous session, as a U.S. warning of an
inevitable pandemic prompted investors to seek refuge in
safe-haven assets.
Spot gold XAU= rose 0.7% to $1,646.19 per ounce by 0826
GMT, having slumped as much as 1.9% in the previous session. On
Monday, prices touched their highest in more than seven years at
$1,688.66.
U.S. gold futures GCv1 eased 0.1% to $1,648.30.
"People are worried that the virus is spreading across the
globe and will become a pandemic," said IG Markets analyst Kyle
Rodda.
"Perhaps, the worst case scenario for the global economy
could start to materialise and that is keeping gold prices bid
because everyone is concerned that the virus is leading to low
yields."
The United States alerted Americans on Tuesday to begin
preparing for the spread of coronavirus in the country as
outbreaks in Iran, South Korea and Italy escalated.
The effects of the outbreak are likely to reverberate beyond
China as most major economies in the region are expected to
either slow significantly, halt or shrink in the current
quarter, Reuters polls found. "Investors are expected to continue to move into safe-haven
assets as the impact on economic development in affected
countries remains a subject of speculation," Phillip Futures
analysts said in a note.
Asian shares fell as worries over the spread of the virus
drove another Wall Street tumble and pushed yields on Treasuries
to record lows. MKTS/GLOB US/
"The market is finding it difficult to look further into the
medium term due to uncertainty regarding what the virus will do
to the global growth. There are beliefs that central banks may
cut rates sooner than later," IG Markets' Rodda added.
The impact of the outbreak on global economic activities
increased bets for monetary policy easing by central banks, with
U.S. money market futures 0#FF: now fully pricing in a 0.25
percentage point cut by end-June. USD/
Lower interest rates reduce the opportunity cost of holding
non-yielding bullion.
Reflecting appetite for gold, holdings in the SPDR Gold
Trust GLD , the world's largest gold-backed exchange-traded
fund, rose 0.7% to 940.09 tonnes on Tuesday. GOL/ETF
Among other precious metals, palladium XPD= gained 1.2% to
$2,730.91 per ounce, while platinum XPT= rose 0.8% to $933.49,
having touched its lowest in two months on Tuesday.
Silver XAG= was up 0.6% at $18.10 an ounce, having fallen
as much as 4.1% in the previous session.
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Gold jumps amid rise in coronavirus cases globally https://tmsnrt.rs/37Vi712
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