April 27, 2020 / 10:19 AM / a month ago

PRECIOUS-Gold falls as hopes of lockdown easings lift risk appetite

 (Updates prices)
    * Bank of Japan eases monetary policy
    * SPDR gold holdings rose 0.6% on Friday
    * Worldwide coronavirus cases approach 3 million
    * For interactive graphic tracking global coronavirus
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    By Brijesh Patel
    April 27 (Reuters) - Gold slipped on Monday as signs that
countries may soon ease coronavirus-driven lockdowns lifted risk
sentiment, although its losses were limited by expectations of
more stimulus measures from major central banks. 
    Spot gold        was down 0.6% at $1,716.77 per ounce by
1237 GMT. 
    U.S. gold futures        were steady at $1,736.20 an ounce.
    "We are starting to see a lot more talk about economies
reopening and trying to get business back to normal as much as
possible and that does seem to be lifting sentiment. This kind
of bounce in risk appetite is potentially fuelling profit taking
in gold," OANDA analyst Craig Erlam said.
    Stock markets also rallied as more countries began easing
lockdowns and the Bank of Japan added more stimulus to cushion
the economic impact of the coronavirus.            
    Various nations, including the United States, are on track
to ease certain restrictions and allow businesses to reopen,
raising hopes of higher numbers of testing kits and more drug
trials.                          
    Some 2.97 million people have been reported to be infected
by the coronavirus globally and 205,948 have died, according to
a Reuters tally.             
    "Even when the lockdown is lifted, the world will still be
far from any kind of normality. The bigger risk then is economic
collapse," Commerzbank analysts wrote in a note.
    "To counter this, governments around the globe are likely to
continue spending unparalleled sums of money – most of which
will be created by the central banks. Gold should remain in
demand as a crisis currency in this environment, as reflected in
ongoing exchange-traded fund (ETF) inflows."
    Gold tends to benefit from widespread stimulus measures as
it is often seen as a hedge against inflation and currency
debasement.
    Holdings of the world's largest gold-backed ETF, SPDR Gold
Trust      , rose 0.6% to 1,048.31 tonnes on Friday.          
    In the latest effort to control economic damage from the
coronavirus, the Bank of Japan pledged to buy unlimited amounts
of government bonds and sharply raise purchases of corporate and
commercial debt.             
    Markets participants now await meetings of the U.S. Federal
Reserve and the European Central Bank later in the week.
    Among other precious metals, palladium        fell 0.7% to
$2,011.11 per ounce, while platinum        gained 0.2% to
$761.18 and silver        eased 0.1% to $15.22. 

 (Reporting by Brijesh Patel in Bengaluru; Editing by Susan
Fenton and Alexander Smith and Louise Heavens)
  
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