PRECIOUS-Gold rises as coronavirus fears, rate cut bets boost demand

(Recasts, updates prices)
* Platinum hits two-month low
* Gold up over 3% so far this month
* Coronavirus interactive graphic: https://tmsnrt.rs/2GVwIyw

By Harshith Aranya
Feb 26 (Reuters) - Gold prices gained on Wednesday following
a steep fall in previous sessions as concerns over the
coronavirus outbreak and its impact on global economy raised
hopes of interest rate cuts by major central banks.
Spot gold XAU= was up 0.7% at $1,645.79 per ounce by 1:40
p.m. EST (1840 GMT) after falling more than 1.5% in the last
session.
U.S. gold futures GCv1 settled 0.4% lower at $1,643.10 an
ounce.
"Besides the safe-haven demand, a growing number of people
are buying in anticipation of weaker growth from the spread of
coronavirus and action from the U.S. Federal Reserve," said Ryan
McKay, a commodity strategist at TD Securities.
"The market is well saturated with bullish news. I think we
are seeing some participants taking profit here ... especially
the longs are taking advantage," he added.
Gold is up over 3% so far this month, having hit a
seven-year high of $1,688.66 earlier this week as the rapidly
spreading coronavirus aggravated fears of an economic slowdown.
The effects of the outbreak are likely to reverberate beyond
China as most major economies in the region are expected to
either slow significantly, halt or shrink in the current
quarter, Reuters polls found. markets are now pricing in roughly two 25-basis-point
(bps) rate cuts by the U.S. Federal Reserve, and expect a 10 bps
cut by the European Central Bank by December. Lower interest rates reduce the opportunity cost of holding
non-yielding bullion.
Indicative of rising investor interest in bullion, holdings
in the SPDR Gold Trust GLD , the world's largest gold-backed
exchange-traded fund, climbed to the highest level since
November 2016 at 940.09 tonnes on Tuesday. GOL/ETF
"Considering that a couple of uncertainties are still
lingering in the market, along with the coronavirus threat and
very low yields, investors are taking positions at a lower
price," said Bob Haberkorn, senior market strategist at RJO
Futures.
"If we see yields at these levels and no other positive news
come about the virus situation, we will see gold go back to
levels it hit earlier."
The dollar rebounded from a two-week low and U.S. markets
also opened higher, after suffering their worst four-day
percentage fall in over a year in the previous session. .N
USD/
Elsewhere, palladium XPD= gained 1.8% to $2,748.93 per
ounce, while platinum XPT= fell 1.5% to $911.79, having
touched its lowest price in over two months earlier.
Silver XAG= eased 0.2% to $17.96 an ounce, having fallen
as much as 3.4% in the previous session.

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Gold jumps amid rise in coronavirus cases globally https://tmsnrt.rs/37Vi712
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