(Adds analyst comment and updates prices)
* Japan to finalise $1 trillion stimulus
* US gold futures hit 7-yr high, extend lead over spot
prices
* British Prime Minister in ICU as COVID-19 complications
worsen
By Asha Sistla
April 7 (Reuters) - Gold prices fell on Tuesday from a
one-month high as equities gained on signs of a slowdown in
fresh coronavirus cases, but concerns over the economic fallout
from the pandemic limited the losses.
Spot gold XAU= fell 0.5% to $1,654.26 per ounce by 0735
GMT, after rising to a one-month high of $1,671.40 earlier in
the session. The metal had risen as much as 2.8% on Monday.
A pullback was expected, said Michael McCarthy, chief
strategist at CMC Markets.
"But it's pretty clear that the trend in the short term is
upward. A lift in equities is not weighing on gold because it
rallied overnight alongside equities ... there appears to be a
serious breakdown in the inverse correlation between gold and
growth assets."
Asian shares followed gains in U.S. stock markets on signs
of a slowdown in coronavirus deaths. USD/ MKTS/GLOB
The United States is bracing for its toughest week yet as
the death toll climbs above 10,000, while across the Atlantic,
British Prime Minister Boris Johnson has entered intensive care
after his COVID-19 symptoms worsened. Supporting bullion were reports that Japan's Prime Minister
Shinzo Abe was set to announce a state of emergency for the
capital, Tokyo, and six other prefectures. A low-interest environment and higher economic concerns
could see gold break though the $1,700 level in the coming weeks
and months, McCarthy said.
In a bid to pump money into economies hammered by the
outbreak, central banks have been turning to quantitative
easing, or large-scale purchases of government bonds and other
financial assets. On the technical front, gold prices will face resistance at
$1,680 and further at $1,700 an ounce, said Jeffrey Halley, a
senior market analyst at OANDA in a note.
U.S. gold futures GCv1 rose 0.9% to $1,709.40, extending a
lead over London spot prices, signalling market worries that
refinery closures and logistics constraints could hamper bullion
shipments to the United States to meet contract requirements.
The increase came despite measures from the CME Group's
CME.O Comex Exchange to ease supply concerns and assurances
from the London Bullion Market Association. Palladium XPD= surged 2.4% to $2,206.31 per ounce, while
platinum XPT= advanced 1% to $742.33.
Silver XAG= jumped 1.7% to $15.24 an ounce, having touched
a more than three-week high earlier.