PRECIOUS-Gold rises to one-week high on economic stimulus hopes

(Updates prices)
* SPDR gold holdings at close to seven-year highs
* U.S. initial weekly jobless claims data due at 1230 GMT
* Interactive graphic tracking the global spread: open https://tmsnrt.rs/3aIRuz7
in an external browser

By Brijesh Patel
April 23 (Reuters) - Gold rose to a one-week high on
Thursday on the expectation of more stimulus from central banks
to limit the economic damage from the coronavirus pandemic as
most countries extend lockdowns to curtail its spread.
Spot gold XAU= was up 0.7% at $1,726.11 an ounce by 1203
GMT. U.S. gold futures GCcv1 gained 0.8% to $1,752.40.
"Gold is rising because the opportunity cost of holding
bullion is becoming attractive. You can print money but not
gold; there are supply limitations," said Bank of China
International analyst Xiao Fu.
"There are a couple of central bank meetings coming up next
week and they could unleash further money tree accommodation.
Investors are looking for some asset class in the current
situation that is relatively safe."
Gold tends to benefit from widespread stimulus measures from
central banks because it is widely viewed as a hedge against
inflation and currency debasement.
Indicative of sentiment, holdings of the world's largest
gold-backed exchange-traded fund, SPDR Gold Trust GLD , rose
0.9% to 1,042.46 tonnes on Wednesday - their highest in nearly
seven years. GOL/ETF
The U.S. House of Representatives expects to pass a
coronavirus relief bill worth nearly $500 billion on Thursday
but will put off any decision on changing its voting rules to
avoid a potential partisan fight. European Union leaders will move towards joint financing of
a recovery after the COVID-19 pandemic by asking the European
Commission to propose a fund sufficiently big for the job that
targets the most affected sectors and regions. The pandemic, which has battered global growth and rattled
financial markets around the world, has prompted governments and
central banks to roll out a wave fiscal and monetary support.
"Gold may be a safer bet as weakening equity markets, along
with negative real rates and continued fiscal and monetary
stimulus should all provide another boost to the precious
metal," FXTM analysts said in a note, adding that it expects
gold to overtake the 2011 peak of $1,925 over the coming months.
Meanwhile, tensions in the Middle East resurfaced after
President Donald Trump instructed the U.S. Navy to fire on any
Iranian ships that harass its ships at sea. Investors also awaited U.S. initial weekly jobless claims
data scheduled for 1230 GMT.
Among other precious metals, palladium XPD= climbed 1.4%
to $1,964.48 an ounce, platinum XPT= rose 0.5% to $761.58 and
silver XAG= gained 0.5% to $15.23.