(Adds graphic, comment and updates prices)
* China cuts benchmark lending rate
* Palladium eases from record high
* Dollar rises to near three-year high
* Coronavirus interactive graphic: https://tmsnrt.rs/2GVwIyw
By Shreyansi Singh
Feb 20 (Reuters) - Gold prices dipped on Thursday after
China unveiled measures to soften the economic impact of the
coronavirus outbreak, but the metal held close to a nearly
seven-year peak scaled in the previous session as concerns over
the epidemic prevailed.
Spot gold XAU= was down 0.3% at $1,606.62 per ounce, as of
0749 GMT. U.S. gold futures GCcv1 dipped 0.1% to $1,609.60.
"It seems to be a bit more corrective mostly because ...
it's not just in gold that we are seeing a bit of a walk-back in
risk-off dynamics, but across a variety of assets," said DailyFx
currency strategist Ilya Spivak.
China's central Hubei province had 349 new confirmed cases
of coronavirus on Wednesday, the province's health commission
said, down from 1,693 a day earlier and the lowest since Jan.
25, although it was accompanied by a change in methodology.
Beijing cut its benchmark lending rate to support an economy
hit by the epidemic, keeping Chinese stocks supported.
MKTS/GLOB
Also limiting any uptick in gold prices, the dollar was
sucking up funds across Asia after a steep and sudden slide in
the Japanese yen called into question its safe-haven status. The
U.S. currency .DXY rose to a near three-year high against key
rivals. USD/
Analysts, however, said concerns over the outbreak capped
losses in bullion, keeping prices close to a high of $1,612.62
hit on Wednesday, its highest since March 25, 2013.
There's still a lot of haven-based buying of gold, said
Jeffrey Halley, senior market analyst at OANDA.
"I suspect this means not everybody is buying into the hype
that China is on the verge of controlling this virus."
Actions by the Federal Reserve would also continue to
determine gold's trajectory, analysts said.
U.S. Fed policymakers were cautiously optimistic about their
ability to hold interest rates steady this year, minutes of the
central bank's last policy meeting showed on Wednesday, even as
they acknowledged new risks caused by the epidemic. "Gold is getting its lions share of equity hedge-related
buying, which is clearly showing up in the gold exchange traded
funds (ETFs), which are increasing," Stephen Innes, chief market
strategist at AxiCorp, said in a note. GOL/ETF
Elsewhere, deficit-hit palladium XPD= fell 0.9% to
$2,688.40 an ounce, having touched a record high of $2,841.54 in
the previous session.
Silver XAG= eased 0.5% to $18.30, but hovered near its
highest in more than a month, hit on Wednesday.
Platinum XPT= slipped 1.2% to $993.40.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Gold versus ETF holdings https://tmsnrt.rs/2SGy5rq
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>