(Updates prices)
* BoE cuts interest rates, Britain announces budget splurge
* U.S. Treasury yields and dollar drift lower
* More than 119,000 people infected by coronavirus globally
By Harshith Aranya
March 11 (Reuters) - Gold rose 1% on Wednesday, regaining some ground after the previous day's near 2% slide, as fears over the economic toll of the coronavirus outweighed an uptick in equity markets following an interest rate cut from the Bank of England.
The BoE on Wednesday joined other central banks in cutting rates, raising hopes for more coordinated monetary and fiscal stimulus. MKTS/GLOB
Looser monetary policy, while stimulating economic growth, tends to benefit gold, as it cuts the opportunity cost of holding non-yielding assets.
Spot gold XAU= was up 1% at $1,664.81 per ounce by 1244 GMT, while U.S. gold futures GCv1 gained 0.4% to $1,666.90.
"Gold remains driven by developments in global financial markets, which are driven by the further development of the coronavirus (outbreak)," Commerzbank (DE:CBKG) analyst Carsten Fritsch said.
The BoE cut rates by half a percentage point, while the British government is also set to spend billions extra in its budget to minimize the economic impact from the outbreak, which has infected more than 119,000 globally. stock markets rose for the first time in five sessions following the BoE cuts. .EU MKTS/GLOB
"All of a sudden, the BoE comes up with emergency rate cut and there's also news from Italy on a complete lockdown, travel restrictions from several European countries and cancellation of big events - so it's getting bigger and bigger," Fritsch said.
The European Central Bank too is expected to unveil new stimulus measures on Thursday. The U.S. Federal Reserve slashed its benchmark rates in an emergency move last week. White House and Congress meanwhile negotiated stimulus measures on Tuesday, although there was no immediate sign of a deal, with the resulting uncertainty also contributing to gold's gains on Wednesday. supporting bullion, U.S. 10-year Treasury yields resumed their slide back towards Monday's record low, while the dollar .DXY fell. US/ USD/
Holdings in the world's largest gold-backed exchange-traded fund, SPDR Gold Trust GLD , held near their highest in more than three years. GOL/ETF
"ETFs are reflecting investment," said Soni Kumari, a commodity strategist at ANZ, adding that the lower interest rate environment and safe-haven demand were boosting inflows.
Elsewhere, palladium XPD= fell 2.2% to $2,367.95 per ounce.
"It was quite surprising that palladium was able to withstand massive headwinds from coronavirus for such a long time, so now it feels the pain of it," Commerzbank's Fritsch said, adding the autocatalyst metal will be weighed down by declining car sales.
Platinum XPT= was up 0.8% at $876.13. Silver XAG= rose 0.6% to $16.96 per ounce.