June 19, 2020 / 10:24 AM / 15 days ago

PRECIOUS-Gold rises as concern over rising virus cases lifts demand

    * Palladium heads for second straight weekly decline
    * Silver on track for second weekly gain
    * EU heads discuss next budget, 750 bln euro recovery fund

 (Adds comment, updates prices)
    By Eileen Soreng
    June 19 (Reuters) - Gold gained on Friday as concerns over a
rise in coronavirus cases propped up demand for the safe-haven
metal, which has benefited in recent months from monetary
stimulus measures to offset the impact of the pandemic. 
    Spot gold        was up 0.5% at $1,731.65 per ounce by 1145
GMT, while U.S. gold futures         were 0.6% higher at
$1,740.90. Spot prices reached their highest since 2012 last
month at $1,764.55.
    "These cases of second waves in certain locations are
basically what is fuelling the pessimistic view that this
recession is going to turn into a longer-lasting depression," 
Julius Baer analyst Carsten Menke said.
    "From my point of view, (gold) is going to remain around the
$1,700 level for the next few months unless we have clarity of
where the economy is going." 
    More than 8.38 million people have been infected by the
coronavirus globally, with some 400 workers being tested
positive at an abattoir in northern Germany, and China reporting
32 new virus cases on Friday.             
    A surge in infections has renewed fears of a delay in
economic recovery as countries reopen after coronavirus-induced
lockdowns.      
    "A break higher would likely come if global growth fails to
pick up meaningfully in the medium term, and that prompts
monetary policymakers to embark on a new wave of monetary
stimulus," said IG Markets analyst Kyle Rodda.
    Gold prices have risen 14% so far this year, supported by
safe-haven demand amid virus-led economic slowdown and
unprecedented amounts of fiscal and monetary support from
governments and central banks.             
    On investors' radar was the European Council's meeting to
negotiate the EU recovery fund aimed at reviving the bloc's
coronavirus-ravaged economies.             
    Elsewhere, palladium        fell 0.9% to $1,907.64 per ounce
and was on track for a second consecutive weekly decline. 
    Platinum        gained 0.8% to $810.65 per ounce and was up
0.6% so far for the week.
    Silver        was up 0.4% at $17.58 and was on track to mark
a second week of gains.  

 (Reporting by Eileen Soreng and Brijesh Patel in Bengaluru;
Editing by Louise Heavens and Jan Harvey)
  
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