April 23, 2020 / 4:03 PM / a month ago

PRECIOUS-Gold jumps to more than 1-week high on U.S. stimulus hopes

 (Updates prices)
    * SPDR gold holdings at close to seven-year highs
    * Weekly U.S. jobless claims total 4.427 million 
    * Interactive graphic tracking the global spread: open tmsnrt.rs/3aIRuz7
 in an external browser

    By Eileen Soreng
    April 23 (Reuters) - Gold prices jumped as much as 1.5% to
more than a one-week high on Thursday, emboldened by hopes of
more stimulus from the United States as a coronavirus-led
lockdown takes a toll on the world's largest economy and its
labor market.
    Spot gold        was up 0.8% at $1,726.94 per ounce at 1:36
p.m. EDT (1736 GMT). Earlier in the session, it touched
$1,738.58, the highest level since April 14. 
    U.S. gold futures         settled up 0.4%, at 1,745.40.
    "Supporting gold is the continuation of global central bank
stimulus, particular today ... Here in the U.S. we're voting on
an additional $500 billion stimulus bill," said David Meger,
director of metals trading at High Ridge Futures.
    Members of the U.S. House of Representatives will gather in
Washington on Thursday to pass a $484 billion coronavirus relief
bill, bringing the unprecedented total of funds approved for the
crisis to nearly $3 trillion.             
    The bill would be the fourth passed to address the crisis
and provides funds to small businesses and hospitals struggling
with the economic toll of the pandemic that has killed more than
47,000 Americans.             
    The U.S. Labor Department said 4.427 million more people
applied for unemployment benefits last week, taking the total in
the past five weeks to a record 26 million, as restrictions to
curb the coronavirus outbreak slam the economy.             
    "The unemployment rate seems poised to hit the 20% level and
this alone should be reason enough for the Federal Reserve and
Trump administration to keep throwing stimulus into the
economy," Edward Moya, a senior market analyst at broker OANDA,
said in a note.
    "Gold's climb towards $1,800 per ounce continues. The
stimulus trade is not going away anytime soon and that should
mean record highs for gold (in dollar terms) by the summer."
    Gold tends to benefit from widespread stimulus measures from
central banks and governments because it is widely viewed as a
hedge against inflation and currency debasement.
    Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust      , rose 0.9% to 1,042.46 tonnes on
Wednesday - their highest in nearly seven years.          
    Meanwhile, divided European Union leaders began their search
for a joint financial fund of up to 2 trillion euros to help the
bloc recover from the pandemic and avoid a collapse in the
economies of its poorer southern members.             
    Elsewhere, palladium        gained 2.6% to $1,989.37 per
ounce and platinum        rose 0.1% to $758.12. Silver       
was 0.2% higher at $15.18.

 (Reporting by Eileen Soreng and Sumita Layek in Bengaluru
Editing by Paul Simao)
  
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