(Reuters) - Gold prices slipped on Friday as investors booked profits, but concerns over the global economic slowdown and massive stimulus measures from major central banks kept bullion on track for a weekly gain.
Spot gold was down 0.4% at $1,724.73 per ounce by 1002 GMT, after hitting a more than one-week high in the previous session. Bullion has risen more than 2% so far this week.
U.S. gold futures edged 0.1% lower to $1,744.60 an ounce.
“We are seeing short-term profit taking here in gold,” said Tai Wong, head of base and precious metals derivatives trading at BMO.
“However, gold is holding well near highs of the move as both retail and institutional investors have been consistently buying as global balance sheets have ballooned and the outlook for the global economy remains extremely uncertain.”
The outbreak of the new coronavirus, which has infected more than 2.7 million people globally, has prompted nations to extend lockdowns to curtail its spread, while central banks have unleashed a wave of measures to limit the financial toll.
On Thursday, the U.S. House of Representatives overwhelmingly approved a $484 billion coronavirus relief bill, while European Union leaders approved an immediate rescue package of about 500 billion euros.
Gold, a safe investment during times of political and financial uncertainty, 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, rose to a near seven-year high, while gold in euros hit an all-time peak of 1,612.39 euros per ounce.
“Gold continues to benefit from this big mix of stimulus that was seen from all over the world. Also the expectations are pretty high that we are not near the end of the stimulus (driven) trade and it is only going to intensify in coming months,” said Edward Moya, a senior market analyst at broker OANDA.
“The one thing that could derail gold’s rally is going to be a vaccine breakthrough for Covid-19.”
Meanwhile, U.S. stock index futures edged higher as some states in the United States prepared to relax curbs imposed to contain the coronavirus outbreak.
Among other precious metals, palladium jumped 2.1% to $2,020.81 an ounce, but was on track to post its fourth straight weekly decline.
Platinum rose 0.5% to $758.84 per ounce, while silver fell 0.7% to $15.20.
Reporting by Brijesh Patel in Bengaluru; Editing by Steve Orlofsky