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Gold steadies amid coronavirus spread, U.S.-China tensions

Gold prices surged, holding firm above the psychological $1,800 level, as worries over surging coronavirus cases and simmering U.S.-China tensions supported the safe-haven metal's demand.

Spot gold was trading 0.1 higher at $1,810.88 per ounce by 0927 GMT, having hit a high of $1,818.09 last week, its highest since September 2011. U.S. gold futures rose 0.05 percent to $1,813.90.

Coronavirus cases continue to increase in the United States, leading many states temporarily halt the reopening of their economies to contain the outbreak. Federal Reserve officials warned that the U.S. economy faces a longer recovery from the pandemic, and economic pain could still worsen as cases surged across the country.

Moreover, simmering tensions between Washington and Beijing also supported safe-haven demand, after U.S. President Donald Trump signed an executive order ending preferential treatment for Hong Kong and also said he does not want to talk to Beijing about trade because of the coronavirus pandemic.

Investor risk appetite slightly improved on news that Moderna Inc’s experimental vaccine for COVID-19 showed it was safe and provoked immune responses in all 45 healthy volunteers in an ongoing early-stage study.

Data released yesterday showed U.S. consumer prices rebounded 0.6 percent month-on-month, the most in nearly eight years, in June, easing worries about deflationary pressures from the economic downturn.

The greenback against a basket of currencies traded 0.3 percent lower at 95.95, having touched a low of 95.87 earlier, its lowest since June 10. The U.S. Treasury yields edged lower, with the benchmark 10-year note yield trading at 0.621 percent.

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