PRECIOUS-Gold gains 1% as virus fears fan growth worries

(Updates prices)
* Coronavirus death toll rises to 81 in China
* U.S. 10-year Treasury yields fall to over 3-month low
* Fed meeting on Jan. 28-29

By K. Sathya Narayanan
Jan 27 (Reuters) - Gold jumped 1% on Monday to a near
three-week high as growing concerns that the coronavirus
outbreak could impact the global economy pushed investors
towards safe havens.
Spot gold XAU= was up 0.6% at $1,580.45 per ounce by 1221
GMT, having earlier touched its highest since Jan. 8 at
$1,586.43.
U.S. gold futures GCcv1 rose 0.5% to $1,579.50 per ounce.
"Risk aversion is pushing up gold prices. Weekend news
showed that (the coronavirus) is still spreading in many
countries across the globe and this could impact economic
activity and market sentiment," Commerzbank analyst Carsten
Fritsch said.
Safe-haven flows were such that a U.S. dollar .DXY holding
near two-month highs scaled in the previous session was doing
little to deter gold buying, despite it making
dollar-denominated bullion costlier for investors holding other
currencies. USD/
The death toll from the coronavirus outbreak has risen to 81
in China, with 2,744 confirmed cases, and the virus has spread
to more than 10 countries, including the U.S. and France.
World shares slipped to their lowest in two weeks, while
U.S. 10-year Treasury yields fell to their lowest in more than
three months. US/ MKTS/GLOB
"Despite the strength of the greenback, the bullion price is
taking advantage of this uncertain situation," ActivTrades Chief
analyst Carlo Alberto De Casa said in a note.
"The main trend remains bullish, with the short-term
correction seen in the last few weeks seemingly over, increasing
the chance of the price achieving a new 7-year-high in the next
few weeks."
Gold had scaled a near 7-year high of $1,610.90 per ounce,
earlier in the month, but the rally was short lived.
Investors will be watching the U.S. Federal Reserve's first
policy meeting of this year on Jan. 28-29, where it is widely
expected to keep rates unchanged. FEDWATCH
Elsewhere, silver XAG= rose 0.9% to $18.24 per ounce,
having earlier touched its highest since Jan. 8 at $18.33.
Deficit hit palladium XPD= dropped 2.2% to $2,373.69 an
ounce, having touched a record high of $2,582.19 last week,
while platinum XPT= fell 1.1%, to $990.37.
Palladium prices fell on profit taking but the correction
has not been considerable and long lasting, Commerzbank's
Fritsch said, adding, a stronger downward correction is overdue
in the market.