PRECIOUS-Gold up 1% on way to biggest weekly gain in 11 years as virus risks mount

(Updates prices, recalculates milestones)
* Global stocks fall, U.S. Treasury yields at record low
* Gold scales 7-year peak
* Interactive graphic on coronavirus spread: open https://tmsnrt.rs/3aIRuz7
in external browser

By Harshith Aranya
March 6 (Reuters) - Gold prices rose more than 1% on Friday
and were on course for their biggest weekly gain since January
2009 as the global spread of the coronavirus dimmed growth
prospects and sent investors scurrying for safe-haven assets.
Spot gold XAU= was up 0.9% at $1,685.25 per ounce at 1231
GMT. Earlier, it touched a high of $1,689.65, or 1.2%, its
highest since January 2013.
Prices are up around 6.3% so far this week. U.S. gold
futures GCcv1 rose 1.1% to $1,686.50.
"The usual out of risky assets into safe havens" flow is
fuelling gold's rise, driven by concerns about the economic
fallout from the virus, said Peter Fertig, an analyst at
Quantitative Commodity Research.
The pan-European STOXX 600 index .STOXX slid in tandem
with global equities on concerns that the economic impact of the
virus will be more severe than anticipated, while U.S. 10-year
Treasury yields slumped to new record lows. MKTS/GLOB US/
"The market has no understanding of what's going on.
Investors are buying bonds as well as gold as insurance from the
deteriorating economic outlook," said SP Angel analyst Sergey
Raevskiy.
Globally, there have been more than 98,000 cases and over
3,300 deaths from the coronavirus. The International Monetary Fund on Wednesday said the
outbreak would hold 2020 global output gains to their slowest
pace since the 2008-2009 financial crisis. The epidemic poses "evolving risks" to the U.S. economy and
central bank officials are monitoring developments closely, New
York Federal Reserve President John Williams said on Thursday.
"Gold is looking to be one of the most attractive assets to
own now as short term interest rates fall to near zero and most
equity earnings are also expected to fall," Phillip Futures
analysts said in a note.
"However a drastic and prolonged drop in equity prices may
not be good for gold as traders cash in from gold to pay off
margin calls in equity."
The U.S. Federal Reserve made an emergency 50 basis point
interest rate cut on Tuesday.
Lower interest rates reduce the opportunity cost of holding
non-yielding bullion.
Elsewhere, palladium XPD= rose 3.1% to $2,610.80 per
ounce. The autocatalyst metal had hit an all-time high of
$2,875.50 in late February.
Silver XAG= was up 0.2% to $17.45 an ounce, while platinum
XPT= rose 4.1% to $900.08.