May 21, 2020 / 3:51 AM / 5 days ago

PRECIOUS-Gold slides on hopes of recovery in economic growth

 (Updates prices)
    * Palladium slides after hitting 1-month high on Wed
    * Markets eye U.S. initial jobless claims data due at 1230
GMT
    * For an interactive graphic tracking the global coronavirus
spread, open tmsnrt.rs/3aIRuz7 in an external browser

    By Swati Verma
    May 21 (Reuters) - Gold fell on Thursday on hopes of a swift
recovery in growth following easing of lockdowns and possibility
of a coronavirus vaccine, but bleak data from major economies
limited losses.
    Spot gold        slid 0.7% to $1,737.09 per ounce by 0744
GMT. U.S. gold futures         slipped 0.8% to $1,738.40.
    Global equities surged overnight, though gains during Asian
hours were limited by lingering caution about the long-term
impact of the coronavirus outbreak.            
    "There is still some optimism and risk-on sentiment about
the possibility of a vaccine and talks of lockdown easing and
growth slowly picking up," said National Australia Bank
economist John Sharma.
    "But it not a huge thing and if it was major, we would see
gold going below $1,700."
    Gold rallied to its highest since October 2012 on Monday,
driven by economic damage concerns, U.S.-China tensions and
massive monetary and fiscal stimulus. 
    U.S. Federal Reserve policymakers acknowledged the
possibility of further support measures if the economic downturn
persists, the minutes from the latest policy meeting showed.
            
    The latest round of dismal economic indicators have
underscored the extent of damage inflicted by the virus, with
data showing Britain's inflation slumped to its lowest since
2016.             
    The initial U.S. jobless claims data due later in the day
will be the next focus for further clues about the health of the
world's top economy.
    Palladium        dropped 1.4% to $2,071.81 an ounce, after
hitting a one-month high on Wednesday. Platinum        fell 0.9%
to $842.78.
    ANZ analysts expect weaker auto sales to be the key downside
risk for the platinum group metals this year and see demand
contracting for both palladium and platinum.
    "Mine supply disruptions could protect the downside; still
we see prices staying volatile amid the ongoing macroeconomic
challenges," they said.
    Silver        declined 1.6% to $17.23 an ounce.

 (Reporting by Swati Verma and K. Sathya Narayanan in Bengaluru;
Editing by Subhranshu Sahu and Rashmi Aich)
  
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