July 20, 2020 / 3:28 AM / 18 days ago

PRECIOUS-Gold steadies above $1,800/oz on rising virus fears

    * Specs cut gold bullish positions in week ended July 14 -
CFTC
    * Interactive graphic tracking global spread of coronavirus:
open
tmsnrt.rs/3aIRuz7 in an external browser

 (Recasts, updates prices)
    By Brijesh Patel
    July 20 (Reuters) - Gold prices steadied on Monday to hold
firm above the psychological level of $1,800 per ounce, as
worries over surging coronavirus cases around the world
underpinned its safe-haven appeal, although a stronger dollar
capped gains.
    Spot gold        was steady at $1,808.92 per ounce by 0721
GMT. U.S. gold futures        were little changed at $1,809.50.
    "There are technical indications that the U.S. dollar could
strengthen and that might be why we are seeing traders in the
gold market taking the lid off the price at the moment," said
Michael McCarthy, chief strategist at CMC Markets.
    "There's no doubt that we are in the medium-term uptrend for
gold. It appears that there's a segment of the investment
community that remains unconvinced about the V shaped recovery,
and they're buying gold."
    The dollar index        rose 0.2% against its rivals, making
gold more expensive for holders of other currencies.       
    Coronavirus cases continue to surge in the United States,
adding to concerns over the recovery of the global economy from
the effects of the pandemic, which has so far infected more than
14 million people worldwide.                          
    Underscoring the impact of the virus, Japan's exports
plunged 26.2% in June from a year earlier, Ministry of Finance
data showed on Monday.             
    Markets are eyeing the European Union Summit for trading
cues, with leaders at an impasse over carving up a proposed 750
billion euro ($858.30 billion) recovery fund to revive
economies.              
    "Gold markets are also becoming addicted to large stimulus
measures from central banks to provide excess liquidity and
which have been driving expectations," Phillip Futures analysts
said in a note.
    "Central banks may disappoint gold investors if the bankers
perceive signs of inflation or economic progress."
    Speculators reduced their bullish positions in COMEX gold
and increased them in silver contracts in the week to July 14.
       
    Palladium        dropped 0.7% to $2,008.01 per ounce, while
platinum        fell 0.1% to $836.91 and silver        was
almost unchanged at $19.32.

 (Reporting by Brijesh Patel in Bengaluru; Editing by Krishna
Chandra Eluri and Vinay Dwivedi)
  
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