PRECIOUS-Gold at 7-year high, set for strongest week in 6-mths

(Updates prices)
* China reports rise in new cases
* Palladium up about 10% so far this week
* Silver on track to post best week in nearly 6-months
* Coronavirus interactive graphic: https://tmsnrt.rs/2GVwIyw

By Shreyansi Singh
Feb 21 (Reuters) - Gold prices rose 1% to their highest in
seven years on Friday and were set for their strongest week in
more than six months as demand for the safe-haven asset
increased after a spike in coronavirus cases.
South Korea reported 52 new cases of the virus, taking the
national total to 156, while Japan reported the first fatalities
from a cruise ship that accounts for the biggest cluster of
infections outside China. Spot gold XAU= rose 0.8% to $1,632.65 per ounce by 0845
GMT, after hitting its highest since Feb. 14, 2013 at $1,635.98
earlier in the session. For the week, prices have risen 3% so
far and were set to post their biggest weekly percentage gain
since Aug. 9.
U.S. gold futures GCv1 jumped 1% to $1,636.50.
"Main focus for gold seems to be the virus uncertainty ...
and its spread across the world," said John Sharma, an economist
at National Australia Bank.
"This is spreading some fear ... not very encouraging in
terms of growth, investment, consumer and business confidence."
Asian shares fell as virus concerns caused funds to seek
shelter in U.S. assets, lifting the dollar to three-year highs.
MKTS/GLOB
China also reported an uptick in new coronavirus cases on
Friday, boosted by more than 200 people testing positive in two
prisons outside of Hubei province. Further spread of the disease could derail a "highly
fragile" projected recovery in the global economy in 2020, the
International Monetary Fund said on Wednesday. China cut its benchmark lending rate on Thursday to soften
the virus' impact on its economy and is likely to roll out more
measures. Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust GLD , rose 0.25% to 933.94 tonnes on
Thursday, its highest since November 2016. GOL/ETF
Spot gold may rise into a range of $1,639-$1,667 per ounce,
said Reuters technical analyst Wang Tao. TECH/C
Elsewhere, palladium XPD= shed 0.1% to $2,687.22 an ounce.
But the metal was up about 10% this week, set for its strongest
week in more than a month.
The autocatalyst metal had risen to a record high of
$2,841.54 earlier in the week on supply concerns.
"Low inventories from a structural market deficit and
limited scope of a supply response should keep demand strong,"
ANZ analysts said in a note.
Silver XAG= was up 0.8% to $18.50 and was set to register
its best week since week ended Aug. 30. Platinum XPT= edged
higher by 0.1% to $978.49.

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