PRECIOUS-Gold falls as fears over new virus variant boost dollar

(Updates prices)
* U.S. economy grew at a record pace in Q3- data
* Possible transmission of new variant to U.S. could boost
gold -
analyst
* Interactive graphic tracking global spread of coronavirus:
https://tmsnrt.rs/3mvcUoa

By Aaron Saldanha
Dec 22 (Reuters) - Gold prices fell on Tuesday as the dollar
benefited from safe-haven buying driven by fears over a new
coronavirus variant in the United Kingdom.
Spot gold XAU= fell 0.7% to $1,862.55 per ounce by 1:57
p.m. EST (1857 GMT), while U.S. gold futures GCv1 settled down
0.7% at $1,870.30.
"Dollar strength has capped some of gold's upward momentum,"
Standard Chartered Analyst Suki Cooper said.
Making gold more expensive for holders of other currencies,
the dollar gained as investors trimmed exposure to riskier
currencies like that of the United Kingdom, which is facing a
new variant of the coronavirus. USD/ Meanwhile, data on Tuesday showed the U.S. economy grew at a
record pace in the third quarter. Gold had hit a six-week high of $1,906.46 on Monday, mainly
supported by U.S. Congress's approval of a $892 billion
coronavirus aid package to support the economy. "Price risks are skewed to the upside for gold as we enter
2021, given our expectations for the dollar to weaken and
monetary policy to remain accommodative, but year-end
profit-taking may cap the gains in the near term." Cooper added.
Gold, considered a hedge against inflation, has still risen
about 23% this year amid the massive stimulus unleashed
globally.
"If the new strain does make its way into the U.S. and does
reinfect people, that could really cause some additional
economic damage and that could be kind of the next tailwind for
gold," said Phillip Streible, chief market strategist at Blue
Line Futures in Chicago.
In other metals, silver XAG= fell 3.7% to $25.19 an ounce,
distancing itself from a more than three-month peak hit in the
previous session.
Platinum XPT= was down 1% at $999.41, while palladium
XPD= rose 0.4% to $2,316.49.