(Adds graphic; updates prices, source role)
* Silver drops 6% to near 2-month trough
* Dollar index hits 8-week peak
* More stimulus needed to support fragile recovery- Fed's
Mester
* Interactive graphic tracking global spread of coronavirus:
https://graphics.reuters.com/world-coronavirus-tracker-and-maps/
By Arundhati Sarkar
Sept 23 (Reuters) - Gold prices slumped more than 2% on
Wednesday to the lowest level in over two months as the dollar
advanced, with investors awaiting further response from major
central banks at a time of economic uncertainty.
Spot gold XAU= dipped 1.9% to $1,862.56 per ounce by 1:57
p.m. EDT (1757 GMT), having hit its lowest since July 22 at
$1,861.60. U.S. gold futures GCv1 settled down 2.1% at
1,868.40 per ounce.
"Gold is currently taking its cue from the dollar ... and
the dollar strength continues to weigh on gold," said Standard
Chartered analyst Suki Cooper.
"We could see a retest of the lows from early August, the
next technical support level thereafter is around $1,840 per
ounce, however prices are closing in on oversold territory."
The dollar index .DXY hit an eight-week high, dimming the
appeal of bullion to holders of other currencies.
Gold prices declined, despite U.S. stocks retreating after
data showed U.S. business activity nudged down in September.
MKTS/GLOB
"Long-term uncertainties are still looming and no investor
would lose the opportunity of adding gold to their portfolio
when prices are low," said Phillip Streible, chief market
strategist at Blue Line Futures in Chicago.
"Investors are waiting and watching what the major central
banks will do next. At this moment most of the monetary and
fiscal policies available have already been implemented."
Policymakers "are not even going to begin thinking" about
raising interest rates until inflation hits 2%, Federal Reserve
Vice Chair Richard Clarida said on Wednesday. Meanwhile, Cleveland Fed President Loretta Mester said
monetary policy will need to remain accommodative for the next
several years and more fiscal stimulus is needed to support the
economy. Widespread stimulus measures have bolstered gold's appeal as
a hedge against inflation risk and currency weakening.
Silver XAG= slid 6.2% to $22.91, having hit a near
two-month low of $22.81 earlier in the session.
Platinum XPT= shed 3.1% to $839.88 per ounce, earlier
touching its lowest since July 20 at $836.50, and palladium
XPD= rose 0.5% to $2,232.07.
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Gold slips for a third straight session as dollar climbs to
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