Pure gold ore is shown on the stone floor of a mine. Picture: 123RF/PHAWAT KHOMMAI
Pure gold ore is shown on the stone floor of a mine. Picture: 123RF/PHAWAT KHOMMAI

Bengaluru — Gold prices inched lower on Friday after surveys showed Chinese manufacturing activity held steady in January and services firmed, though concern over the coronavirus and its economic effect kept the metal on track for a second monthly gain.

Spot gold fell 0.1% to $1,571.77/oz by 1.24am GMT. For the month, prices were up 3.6%. US gold futures declined 0.8% to $1,570.70.

Factory activity in China stalled in January, with the outbreak of the new virus adding to risks facing the economy despite easing trade tension, while growth in the services sector activity quickened.

This came after the World Health Organisation (WHO) declared the coronavirus a global emergency, as the death toll in China reached 213 and cases spread to at least 18 countries.

Director-general Tedros Ghebreyesus said the WHO “doesn't recommend — and actually opposes” restrictions on travel or trade with China, and that measures taken by Beijing can “reverse the tide”.

The US economy missed the Trump administration's 3% growth target for a second consecutive year, posting its slowest annual growth in three years in 2019.

The US House of Representatives passed two pieces of legislation on Thursday seeking to rein in President Donald Trump’s ability to deploy US forces to fight abroad.

The virus outbreak in China is emerging as a potentially major new risk to the global economy and leaving policymakers, still grappling with the effect of the China-US trade war, fretting over the widening fallout.

On the Brexit front, the UK leaves the EU on Friday for an uncertain future.

India’s gold demand is expected to rebound in 2020 as the government seeks to bolster consumer confidence and spending power to revive Asia’s third-biggest economy, the World Gold Council (WGC) said.

Palladium rose 0.3% to $2,316.71/oz. Prices were set to gain of 19% in January, but were down nearly 5% this week.

Silver fell 0.2% to $17.79 and was down 1.5% for the week, its biggest since the week ended December 6, while platinum climbed 0.4% to $981.63 and was on track to decline 2% for the week.

Reuters

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