PRECIOUS-Gold jumps 1% to multi-year peak on weaker dollar, stimulus hopes

* Silver jumps nearly 5%, hits near seven-year high
* Trump warns of worsening COVID-19 pandemic
* Dollar nurses losses, holds near four-month low
* GRAPHIC-2020 asset returns: http://tmsnrt.rs/2jvdmXl

(Updates prices)
By Brijesh Patel
July 22 (Reuters) - Gold rose more than 1% on Wednesday to
its highest in nearly nine years, driven by a softer dollar and
as expectations of more stimulus to revive pandemic-hit
economies lifted the metal's appeal as an inflation-hedge.
Spot gold XAU= was up 1% at $1,859.56 per ounce by 0713
GMT, after hitting its highest since September 2011 at $1,865.35
earlier in the session.
U.S. gold futures GCcv1 rose 0.9% to $1,860.40.
"The spectre of these stimulus packages has pushed investors
back into non-yielding assets like gold," said ANZ analyst
Daniel Hynes.
"The likelihood of interest rates remaining low for the
foreseeable future and the weaker U.S. dollar have really
boosted investor appetite."
European Union leaders on Tuesday sealed a 750 billion euro
recovery plan, while White House officials and top congressional
Democrats discussed another round of relief that would include
extended unemployment insurance and more money for schools.
Helping bullion's rally, the dollar index .DXY held near a
more than four-month low. USD/
Coronavirus cases continued to surge in the United States,
and crossed the 15-million threshold globally. Underscoring the pandemic's impact, Japan's factory activity
contracted for a 15th straight month in July. Central banks have slashed interest rates and rolled out a
wave of stimulus measures to cushion the economic damage from
the pandemic, helping gold prices surge over 22% so far this
year.
Silver XAG= was up 4.8% at $22.34 per ounce after hitting
its highest since October 2013 at $22.82.
"Silver spot prices have outperformed gold so far this
month, an interesting reversal of the norm," said Cailin Birch,
global economist at The EIU, adding that it reflected market
optimism for global industry, as silver has many industrial
uses.
"Overall, we expect demand for safe-haven assets like gold
and silver to remain relatively strong for the remainder of
2020."
Palladium XPD= gained 0.7% to $2,172.18 and platinum
XPT= rose 0.9% to $889.47.