Gold price on course for third weekly gain as coronavirus cases spike

London (June 26)  Gold prices edged up on Friday en route to a third straight weekly gain, as a spike in coronavirus cases dashed hopes of a quick economic recovery.

Spot gold rose 0.1% to $1,762.41 per ounce by 0953 GMT, having soared to a peak since Oct. 2012 at $1,779.06 on Wednesday, putting it on course for a 1.1% gain for the week. U.S. gold futures rose 0.2% to $1,774.70 per ounce.

"Gold is finding tailwind from concerns about a second wave of infections as some US states see the number of new cases soar," Commerzbank analysts said in a note. "The expansion of central bank liquidity and public debt resulting from this continues to argue for a robust demand for gold as a safe haven and store of value," they added.

Coronavirus cases have been rising across the United States, while over 9.51 million people have been infected globally, according to a Reuters tally.

Gold prices have gained 16% so far this year buoyed by increased central bank and government stimulus measures globally to cushion economies from the blow of the COVID-19 pandemic. The metal also held ground despite a steady dollar and an uptick in European shares.

Technically, gold is in a consolidation phase and could see further rallies if investors become more risk averse, ActivTrades chief analyst Carlo Alberto De Casa said in a note. Reflecting positive sentiment, holdings of the SPDR Gold Trust ETF held near an over seven-year peak.

"Given the macro backdrop, sentiment in the gold market is positive, and this is illustrated in the continual increase in exchange-traded fund holdings," said ING analyst Warren Patterson. Palladium rose 0.6% to $1,853.03 per ounce.

Platinum fell 0.9% to $796.00 per ounce and silver was down by 0.4% at $17.80 per ounce.

Reuters