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PRECIOUS-Gold eases as equities shrug off virus fears

Published 14/02/2020, 08:28 pm
© Reuters.  PRECIOUS-Gold eases as equities shrug off virus fears
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(Updates prices)

* Gold on track for 0.3% weekly gain

* Dollar rises to more than four-month high

* Investors await U.S. retail sales, consumer confidence numbers

By K. Sathya Narayanan

Feb 14 (Reuters) - Gold dropped off a more than one-week high on Friday as hopes for global measures to counter the coronavirus outbreak increased appetite for equities, though the metal remained on track for a weekly gain.

Spot gold XAU= was down 0.1% at $1,575.31 an ounce at 0846 GMT, having touched its highest since Feb. 4 at $1,577.89.

U.S. gold futures GCv1 were flat at $1,579.

"Equities markets have shrugged off the bearish sentiment and started to move higher as investors reassess the potential (economic) impact of the virus," said CMC Markets analyst Margaret Yang Yan, adding that bullion is also being pressured by a strong dollar.

Asian shares were poised for a second straight week of gains and the dollar .DXY rose to a more than four-month high against a basket of major currencies. MKTS/GLOB USD/

However, analysts said that interest in gold remains undimmed as the death toll in China's Hubei province continues to rise. has gained about 0.3% this week.

Investors will also be watching for U.S. retail sales and consumer confidence numbers due later in the day.

"The U.S. consumer is really the biggest piece of global growth at this point," said DailyFx currency strategist Ilya Spivak, pointing to a sluggish Europe as well as China's health crisis and trade war with the United States.

U.S. prosecutors on Thursday accused Chinese company Huawei HWT.UL of stealing trade secrets. Washington had placed the telecoms equipment maker on a trade blacklist last year. latest accusations come as the two countries pursue a Phase 2 trade agreement after signing a Phase 1 deal in an apparent thaw in relations after a prolonged trade dispute.

"Given it is an election year in the U.S., the consensus in the gold market is that the Chinese would do anything to make sure they don't cause any further disruption to their economy, at a time when it is pretty vulnerable," said IG Markets analyst Kyle Rodda.

In other precious metals, palladium XPD= rose 0.6% to $2,438.71 an ounce, set for its strongest week in a month.

Silver XAG= gained 0.3% to $17.69, while platinum XPT= was up 0.3% at $970.60.

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