Gold prices fell on Thursday as expectations of a surge in US jobless claims due to the coronavirus outbreak eclipsed a massive US stimulus package and kept alive a rush for cash among investors.
Spot gold was down 0.7% to $1,602.06 per ounce by 0751 GMT, after falling 1% earlier in the session.
"There is no positive growth story here until business reopens, and that might see all these assets, that have been benefiting from the US Federal Reserve's (recent) stimulus announcement, including gold, come back down," said DailyFx currency strategist Ilya Spivak.
The US Senate on Wednesday overwhelmingly backed a $2 trillion bill aimed at helping unemployed workers and industries hurt by the coronavirus.
This came after the Fed said on Monday it would buy bonds in unlimited numbers and backstop direct loans to companies.
"There's panic among traders and investors and they don't trust even gold," said Hareesh V, head of commodity research at Geojit Financial Services.
Gold market participants, meanwhile, are concerned about a supply squeeze in the market, following a sharp divergence in London and New York prices as the coronavirus closed precious metals refineries.
US exchange operator CME Group on Tuesday announced a new gold futures contract to combat price volatility caused by the shutdown of gold supply routes, but traders and bankers said it would not immediately calm markets.
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