Gold gained overnight as worries over economic growth due to the fast-spreading coronavirus buoyed safe haven demand, with investors awaiting the US federal Reserve’s monetary policy decision.
Spot gold was up 0.3 per cent at $US1,570.36 per ounce.
USd futures settled mostly unchanged at $US1,570.40 per ounce.
The United States and Japan evacuated their nationals from a quarantined city, Wuhan, in China, while British Airways suspended flights as deaths from the outbreak rose to 132 and the first cases emerged in the Middle East.
Although better-than-expected corporate earnings helped drive a slight recovery in financial markets, fears over the economic fallout from the outbreak weighed on investor appetite for riskier assets.
On Tuesday, gold prices fell nearly 1 per cent after positive US ecoc data lifted equity markets along with the dollar.
Further bolstering gold’s appeal, US Treasyields also fell on concerns surrounding the epidemic.
“The main driver for gold this year will be strategic inflows, as it will continue to be viewed as an attractive diversifier for investor portfolios in an environment where rates remain low,” UBS strategist Joni Teves said.
Elsewhere, palladium eased 0.1 per cent to $US2,286.08 per ounce, while platinum dipped 1.5 per cent to $US971.04.
Palladium will cost on average more than twice as much as platinum this year, but that premium will narrow in 2021, a Reuters poll showed.
Silver rose 0.2 per cent to $US17.48, having earlier dipped to its lowest since Dec. 23 at $US17.35.