PRECIOUS-Gold gains as uncertainty over Trump's response to China spurs demand

Reuters

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    * Gold up more than 3% so far for May
    * Silver hits peak since Feb. 27 at $17.90/oz
    * For an interactive graphic tracking the global coronavirus
spread, open https://tmsnrt.rs/3aIRuz7 in an external browser

 (Updates prices)
    By Eileen Soreng
    May 29 (Reuters) - Gold rose 1% on Friday as caution set in
with investors awaiting U.S. President Donald Trump's response
to a Chinese national security law for Hong Kong and its
potential impact on an already fragile global economy. 
    Spot gold  XAU=  climbed 0.9% to $1,734.70 per ounce by 1:44
p.m. EDT (1744 GMT).    
    U.S. gold futures  GCv1  settled up 1.4% at $1,751.70.
    "Markets are now strictly focused on the two largest
economies and what is likely going to be a long, drawn-out
battle," said Edward Moya, a senior market analyst at broker
OANDA.
    "You're going to continue to see safe-haven demand (for
gold) because the uncertainty over how the U.S.-China tensions
are going to play out is extremely high."
    Trump is expected to hold a news conference on China later
on Friday as his administration moves to pressure Beijing over
its treatment of Hong Kong.  urn:newsml:reuters.com:*:nL4N2DA0NH  urn:newsml:reuters.com:*:nL4N2DB0H6
    Mounting fears over the economic toll from the coronavirus,
exacerbated by the widening U.S.-China rift, and a resultant
environment of low interest rates globally have put safe-haven
bullion on track for an over 3% monthly gain.
    "Stock market gains are likely to cap gold's upward
momentum, however, gold prices have risen amid a risk-on
environment and a risk-off environment," said Standard Chartered
Bank analyst Suki Cooper. "There is good downside support around
$1,700 and resistance around $1,765." 
    Wall Street's main indexes fell on Friday, bolstering gold's
appeal.  .N 
    Elsewhere, silver  XAG=  gained 2.5% to $17.86 an ounce.
Prices were up 18.8% for the month, the biggest gain since 
January 2012.
    Global efforts to restart economies could boost silver
demand, making prices of the metal, which slipped to an all-time
low relative to gold during the crisis, likely to rebound
strongly.  urn:newsml:reuters.com:*:nL4N2DA2LE
    Palladium  XPD=  fell 1% to $1,911.54 an ounce. Platinum
 XPT=  slipped 0.8% to $831.90 but was on track for its best
month since August 2019. 

 (Reporting by Eileen Soreng in Bengaluru; Editing by Tom Brown,
Dan Grebler and Diane Craft)
 ((eileen.soreng@thomsonreuters.com; Within U.S. +1 646 223
8780, Outside U.S. +91 80 6749 6131; Reuters Messaging:
eileen.soreng.thomsonreuters.com@reuters.net))

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