July 23, 2020 / 1:15 AM / 17 days ago

PRECIOUS-Gold near nine-year high as U.S.-China woes, stimulus hopes boost appeal

    July 23 (Reuters) - Gold rose to its highest in nearly nine
years on Thursday, driven by an escalation in U.S.-China
tensions, while expectation of more stimulus measures lifted the
metal's appeal as an inflation-hedge.
                                
    FUNDAMENTALS    
    * Spot gold        was up 0.1% at $1,872.75 per ounce by
0048 GMT, after hitting its highest since September 2011 at
$1,876.16 in early Asian trade.
    * U.S. gold futures        rose 0.2% to $1,869.30.
    * The United States gave China 72 hours to close its
consulate in Houston amid accusations of spying, marking a
dramatic deterioration in relations between the world's two
biggest economies.             
    * Coronavirus cases continued to surge in the United States,
with California officially becoming the worst-hit state,
exceeding New York, with more than 414,000 cases of COVID-19. 
            
    * Leading U.S. Senate Republicans and the White House late
on Wednesday said they had hammered out agreements in principle
on portions of a potential coronavirus-response bill, which
could be presented to Democrats as early as this week.
            
    * Gold is often used as a safe store of value during times
of political and financial uncertainty.
    * Indicative of sentiment, SPDR Gold Trust      , the
world's largest gold-backed exchange-traded fund, said its
holdings rose 0.4% to 1,225.01 tonnes on Wednesday from 1,219.75
tonnes on Tuesday.          
    * Further helping gold, the dollar index        held near a
more than four-month low that it hit in the previous session.
      
    * Asian stocks were likely to come under pressure on
Thursday as fresh diplomatic tensions between Washington and
Beijing heightened investor jitters.            
    * Silver        fell 0.7% to $22.86 per ounce, platinum
       dropped 0.7% to $912.79, while palladium        climbed
0.6% to $2,160.91.
    
    DATA/EVENTS (GMT)
0645  France  Business Climate Mfg    July
1230  US      Initial Jobless Claims  Weekly
1400  EU      Consumer Confid. Flash  July
    

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