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PRECIOUS-Gold gains as gloomy U.S. economic outlook dents dollar

Published 2020-08-20, 11:12 p/m
© Reuters.
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* Gold up 0.2% so far this week, silver up 3%

* New U.S. unemployment benefit claims back above 1 mln mark

* Washington declines to acknowledge plans to meet China on trade

* Interactive graphic tracking global spread of coronavirus: open https://tmsnrt.rs/3aIRuz7 in an external browser (Updates prices)

By Brijesh Patel

Aug 21 (Reuters) - Gold prices rose on Friday after bleak U.S. jobless claims data reinforced fears of a slower recovery from the coronavirus-induced economic crisis, denting the dollar and U.S. Treasury yields.

Spot gold XAU= was up 0.2% at $1,947.04 per ounce by 0655 GMT. Gold is up 0.2% so far this week, having shed 4.5% in the week to Aug. 14, its worst in five months.

U.S. gold futures GCcv1 rose 0.4% to $1,954.40.

"A deterioration in U.S. labour market data, falling bond yields and continued geopolitical tensions continue to support gold," said National Australia Bank economist John Sharma.

"We see gold trading between $1,920 and $1,980 in the near term," he said, adding that factors such as rising risk sentiment and progress on the coronavirus vaccine front could dent demand.

A technology stocks-fuelled rally on Wall Street drove Asian markets higher on Friday, limiting gold's advance. MKTS/GLOB

Data on Thursday showed the number of Americans filing a new claim for unemployment benefits rose unexpectedly back above the 1 million mark last week, a setback for a struggling U.S. job market crippled by the coronavirus pandemic. sent the dollar index .DXY and benchmark 10-year Treasury yields lower, making gold an attractive investment for holders of other currencies. USD/ US/

Adding to doubts over a swift U.S. economic rebound, Federal Reserve officials on Wednesday warned that a recovery faced a highly uncertain path, helping gold recover from a more than 3% slump earlier this week. the rebound in prices, precious metals do have short-term downside risks that would continue to affect prices," Phillip Futures analysts said in a note.

Meanwhile, the Trump administration declined to acknowledge any plans to meet with China over the Phase 1 trade deal. silver XAG= was steady at $27.22 per ounce and was poised for a weekly rise of about 3%

Platinum XPT= climbed 0.4% to $921.16, while palladium XPD= fell 0.4% to $2,171.99.

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