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PRECIOUS-Gold falls as cash dash, strong dollar override stimulus

Published 23/03/2020, 09:54
© Reuters.
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(Updates prices)
* Dollar hovers near 3-year high against major currencies
* Coronavirus global death toll over 14,000
* Spot gold to retest support at $1,452/oz - analyst
* Interactive graphic tracking global spread of coronavirus:
open
https://tmsnrt.rs/3aIRuz7 in an external browser.

By Asha Sistla
March 23 (Reuters) - Gold prices fell on Monday as investors
stockpiled cash, with a rising numbers of coronavirus-led
national lockdowns threatening to overshadow stimulus measures
from global central banks to combat the pandemic's economic
damage.
Spot gold XAU= slipped 0.6% to $1,488.00 per ounce by 0825
GMT, after rising as much as 3.1% in the previous session on a
wave of stimulus. U.S. gold futures GCcv1 climbed 0.5% to $1,491.50.
"For the time being, gold is not serving as a safe-haven
because of margin calls and panic. There is capital outflow from
everywhere," said Vandana Bharti, assistant vice-president of
commodity research at SMC Comtrade.
"(Investors) are winding up their positions. It's not
technical or fundamental - it's all panic."
Asian shares sank as a rising tide of lockdowns threatened
to overwhelm policymakers' frantic efforts to cushion what is
likely to be a deep global recession. MKTS/GLOB
Another concern is the possibility of central banks having
to sell gold to buy dollars as the greenback continues to
strengthen, said Stephen Innes, chief market strategist at
financial services firm AxiCorp.
The dollar held near a three-year high against major
currencies as fresh declines in global stocks and worries about
tightening liquidity amid the worsening crisis accelerated the
flight to cash. USD/
The U.S. Federal Reserve continued to roll out emergency
support on Friday as it enhanced efforts with other major
central banks to ease a global dollar-funding crunch.
Market participants are counting on further policy easing in
the next few days as the U.S. Senate mulls a $1 trillion package
that would include direct financial help for Americans.
Airlines cancelled more flights as Australia and New Zealand
advised against non-essential domestic travel, the United Arab
Emirates halted flights for two weeks, and Singapore and Taiwan
banned foreign transit passengers. Meanwhile, nearly one in three Americans were ordered to
stay home to slow the spread of the disease, while Italy banned
internal travel as deaths there reached 5,476 and China reported
46 new cases on Sunday that were mostly imported from overseas.
The global death toll from the coronavirus exceeded over
14,000 with more than 300,000 infections.
Spot gold XAU= is expected to retest a support at $1,452
per ounce, a break below which could cause a fall to $1,374,
said Reuters technical analyst Wang Tao. TECH/C

Among other precious metals, palladium XPD= inched up 0.2%
to $1,644.99 per ounce, platinum XPT= shed 0.2% to $609.56 and
silver XAG= slid 0.9% to $12.47.

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