PRECIOUS-Gold gains as virus-led economic concerns boost safety buying

(Updates prices)
* U.S. factory activity in March weakest since 2009 -survey
* U.S. private payrolls post first decline since 2017
* Wall St slumps as coronavirus fears intensify
* Perth Mint's March gold sales hit close to seven-year high

By Sumita Layek
April 1 (Reuters) - Gold prices firmed on Wednesday as
investors sought safe-haven assets after sombre U.S. economic
data exacerbated fears of a economic downturn amid increasing
lockdowns and other restrictions globally to combat the
coronavirus pandemic.
Spot gold XAU= was up 0.6% at $1,580.29 an ounce by 1:54
pm EDT (1754 GMT), having earlier risen as much as 1.8%. U.S.
gold futures GCv1 settled 0.3% lower at $1,591.40.
"The unprecedented macroeconomic backdrop has been drawing
more investors to real assets like gold. Central banks across
the world are loosening their balance sheets and getting ready
for further easing to mitigate the impact of the outbreak," said
Soni Kumari, commodity strategist at ANZ.
"We therefore see real interest rates staying in the deep
negative territory for a while ... Such a backdrop remains
favourable for gold investments."
The U.S. manufacturing sector contracted in March, with
activity hitting its lowest level since 2009, as the coronavirus
outbreak caused widespread shortages, a survey showed.
Also, U.S. private payrolls dropped in March for the first
time since 2017, supporting economists' views that the longest
employment boom in history ended last month. As evidence mounted that the pandemic was sending the global
economy into a deep recession, equity markets began the new
quarter with steep losses. MKTS/GLOB .N
U.S. President Donald Trump warned Americans on Tuesday of a
"painful" two weeks ahead in fighting the coronavirus, with a
mounting U.S. death toll that could stretch into the hundreds of
thousands even with strict social distancing measures.
The contagion has infected over 851,000 people worldwide and
killed 42,053, according to a Reuters tally. On Tuesday, the U.S. Federal Reserve broadened the ability
of dozens of foreign central banks to access dollars during the
crisis by allowing them to exchange their holdings of U.S.
Treasury securities for overnight dollar loans. "Technically, the gold bulls still have the overall
near-term technical advantage but they are fading this week and
need to show fresh power soon," Kitco Metals senior analyst Jim
Wyckoff said in a note.
Resistance lay at around $1,612.40 and then at $1,625,
Wyckoff added.
Reflecting investor sentiment, the Perth Mint's gold product
sales in March soared to their highest in about seven years.
Holdings in SPDR Gold Trust GLD , the world's largest
gold-backed exchange-traded fund, rose 0.3% to 967 tonnes on
Tuesday. GOL/ETF
Elsewhere, platinum XPT= fell 1.4% to $711.76 an ounce,
palladium XPD= dropped 5.3% to $2,228.16 and silver XAG=
shed 0.6% to $13.88.