PRECIOUS-Gold near one-week low as coronavirus fears ease

(Updates prices)
* SPDR Gold holdings jump to over three-month high
* Dollar holds near four-month high

By Sumita Layek
Feb 12 (Reuters) - Gold prices eased to a near one-week low
on Wednesday as investors' risk appetite picked up on reports of
a decline in new coronavirus cases, although concerns remained
over the potential impact of the outbreak on the global economy.
Spot gold XAU= was down 0.1% to $1,565.80 per ounce at
1254 GMT, having touched its lowest since Feb. 6 at $1,561.16
earlier. U.S. gold futures GCcv1 were flat at $1,569.30.
Peter Fertig, an analyst at Quantitative Commodity Research,
said a recovery in riskier assets like stock markets, and a
stronger U.S. dollar were reducing gold's safe haven appeal.
"The rate of (coronavirus infection) rises is getting slower
... it's showing that an end of this epidemic is in sight," he
said.
World stocks rose, with European shares hitting record highs
for the second straight session, on hopes the epidemic's effects
would be contained and on U.S. Federal Reserve chairman's
optimistic view of the economy. .EU MKTS/GLOB
China on Wednesday reported its lowest number of new
coronavirus cases since late January, lending weight to a
prediction by its senior medical adviser that the outbreak could
end by April. Further weighing on gold, the U.S. dollar held close to
four-month highs, making assets priced in the U.S. currency more
expensive for holders of other currencies. USD/
Federal Reserve Chair Jerome Powell told Congress on Tuesday
the U.S. economy was in a good place, but cited the potential
threat from the virus epidemic and concerns about the economy's
long-term health. Gold, which is often used as insurance against economic
risks, tends to appreciate on expectations of lower interest
rates, which reduce the opportunity cost of holding non-yielding
bullion.
"Even though gold is range bound ... $1,600 is on the cards,
but it may take a bit longer," said Afshin Nabavi, senior vice
president at precious metals trader MKS SA, pointing to
unresolved geopolitical tensions such as in the Middle East and
U.S.-Chinese trade frictions.
Reflecting investors' interest in bullion, holdings of the
world's largest gold-backed exchange-traded fund, SPDR Gold
Trust GLD , rose 0.67% to 922.23 tonnes on Tuesday, the highest
in over three months. GOL/ETF
Among other precious metals, palladium XPD= slipped 0.5%
to $2,330.25 an ounce, silver XAG= fell 0.4% to $17.56, having
earlier fallen to $17.44, a level last seen on Feb. 5 and
platinum XPT= shed 0.5% to $963.75.