June 11, 2020 / 2:39 PM / 2 months ago

REFILE-PRECIOUS-Gold eases on firmer dollar, but holds near one-week high

 (Refiling to fix time element regarding bullion in 1st
paragraph)
    * Wall Street slides on fears of fresh coronavirus wave
    * Fed vows to keep monetary policy easy
    * New infection cases fuels risk-off sentiment - analyst

    By Asha Sistla
    June 11 (Reuters) - Gold eased on Thursday as the dollar
firmed but fears over a fresh wave of coronavirus infections and
the U.S. Federal Reserve's pledge to keep interest rates low
kept bullion close to its highest in over a week.
    Spot gold        was down 0.33% at $1,730.58 per ounce at 
2:04 p.m. EDT (1804 GMT), having earlier hit its highest since
June 2 at $1,744.36. U.S. gold futures         settled up 1.1%
at $1,739.80.
    "You had a lot of fresh infections, which seemed to spook
investors a bit so that pretty much put everybody into a
risk-off and basically they're selling everything except for the
dollar and natural gas," said Michael Matousek, head trader at
U.S. Global Investors. 
    The dollar        rose versus major currencies, benefiting
from safe-haven flows as Wall Street slumped on reports of a
rise in virus cases as most U.S. states reopen.     
                                
    Traders did not read too much into the slight pullback in
gold, saying the safe-haven metal's longer term trajectory was
still positive. 
    Tai Wong, head of base and precious metals derivatives
trading at BMO, attributed it to "some adjustment from longs who
have had quite a windfall over the last 24 hours."
    "Many market participants remain convicted that 'this time
it will be different' as gold rallies once again to the top of
range despite having failed break higher in four previous
attempts over 10 weeks." 
     On Wednesday, spot gold notched up its biggest daily
percentage rise in more than a month, as the Fed flagged the
need to keep the key interest rate near zero through at least
2022.
    Gold has rallied about 20% since touching an over
three-month low of $1,450.98 on March 16.
    Low interest rates tend to support gold, considered a hedge
against inflation and currency debasement.
    Elsewhere, silver        declined 3.1% to $17.69 per ounce,
after rising 3.8% on Wednesday.
    Palladium        fell 1% to $1,928.03 per ounce, and
platinum        dipped 2.2% to $814.30.

 (Reporting by Eileen Soreng and Asha Sistla in Bengaluru;
editing by Jonathan Oatis and Tom Brown)
  
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