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Gold gains but set for weekly drop amid flight for cash

Logo - The Daily Drill - Digging Deep for precious metal news

March 20 (Reuters) -

Gold prices rose on Friday after a fall in the previous session, but the metal was on track to post its second weekly drop due to a rush for cash amid the widening economic fallout from the coronavirus outbreak.

FUNDAMENTALS * Spot gold rose 0.4% to $1,475.43 per ounce by 0029 GMT. It was down more than 3% for the week. * The metals fell more than 1% on Thursday as the dollar jumped to multi-year highs and investors continued to sell assets to hoard cash. * U.S. gold futures fell 0.3% to $1,474.20 per ounce. * MSCI's broadest index of Asia-Pacific shares outside Japan firmed 0.6%, while Australia's beleaguered market rose 2.9%.

* The U.S. Federal Reserve opened the taps for central banks in nine new countries to access dollars in hopes of preventing the coronavirus epidemic from causing a global economic rout. * The United States warned Americans on Thursday to return home or stay abroad indefinitely, while Senate Republicans unveiled a $1 trillion economic stimulus plan to provide funds directly to businesses and the American public, as the number of virus cases in the country surged past 13,000. * The Bank of England promised 200 billion pounds of bond purchases and cut its key interest rate to 0.1% in a second emergency move in just over a week to try to mitigate the hit to Britain's economy from the outbreak.

* The global economy is already in a recession as the hit to economic activity from the virus has become more widespread, according to economists polled by Reuters amid a raft of central bank stimulus actions this week. * The number of Americans filing for unemployment benefits surged by the most since 2012 to a 2-1/2-year high last week, as companies in the services sectors laid off workers because of the epidemic. * The outbreak caused the steepest drop in German manufacturers' expectations in the 70-year history of surveys, data showed.

* SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, said its holdings fell 0.16% to 922.23 tonnes on Thursday. * Palladium fell 0.5% to $1,644.04 per ounce. Platinum rose 1.6% to $595.69 but was set to post its biggest ever weekly fall. * Silver gained 0.4% to $12.16, but was on track to post its biggest weekly decline since September 2011.

DATA/EVENTS (GMT) 1400 U.S. Existing Home Sales (Feb)

(Reporting by K. Sathya Narayanan in Bengaluru; Editing by Subhranshu Sahu)

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