PRECIOUS-Gold surges to record high as dollar slips, Sino-U.S. row intensifies

* Silver notches up fresh 7-year peak
* Dollar falls to two-year low
* U.S. consulate in Chengdu closed as of Monday morning -
China
* Interactive graphic tracking global spread of coronavirus:
open
https://tmsnrt.rs/3aIRuz7 in an external browser

(Updates prices)
By Eileen Soreng
July 27 (Reuters) - Gold soared to its highest ever on
Monday as heightened U.S.-China tensions hammered the dollar and
sped up a flight to safety among investors concerned that the
spat could amplify the economic hit from the coronavirus
pandemic.
Spot gold XAU= hit a record high of $1,944.73 per ounce,
and by 1132 GMT was up 2.1% to $1,941.67. U.S. gold futures
GCcv1 gained 2.1% to $1,937.90 per ounce.
Silver XAG= also rallied jumping as much as 8% to $24.57,
its highest since August 2013.
Bullion is surging on a broadly weaker dollar, U.S.-China
tensions and negative real yields, FXTM analyst Lukman Otunuga
said.
"Buying sentiment towards the precious metal is through the
roof, with further gains expected in the medium to longer term,"
he added.
In the latest escalation of Sino-U.S. tensions, China took
over the premises of the U.S. consulate in the southwestern city
of Chengdu on Monday in retaliation for Beijing's ouster last
week from its consulate in Houston, Texas. This sent the dollar index .DXY to its lowest in two
years. USD/
"Safe-haven demand (for gold) has been rising while there is
none for USD anymore," said ANZ commodity strategist Soni
Kumari.


Investors are now awaiting the U.S. Federal Reserve's
meeting starting Tuesday, where it could flag another
accommodative policy shift. "You'd need a pretty upbeat and unexpectedly positive
assessment from the Federal Open Market Committee to really
dampen this rally," said Julius Baer analyst Carsten Menke.
"Even if you had a surprise from the FOMC which weighed on
gold, this is an opportunity to buy the dip."
Non-yielding gold is considered a hedge against inflation
and currency debasement, with analysts also pointing to massive
inflows into gold-backed exchange traded funds as a driver
behind its 28% rally in 2020. GOL/ETF CFTC/
Meanwhile, COVID-19 cases surged to over 16.13 million
globally, driving expectations of more stimulus to stem the
economic blow. Platinum XPT= rose 3.1% to $942.78 per ounce and palladium
XPD= climbed 3.6% to $2,299.24.

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Silver soars to 7-year hghs on gold's coattails https://tmsnrt.rs/3jHwHAq
Gold soars as dollar dips https://tmsnrt.rs/39CUs8c
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