NEW YORK: Gold clung to the $1,900 level in choppy trading early in New York on Friday, with gains capped by a firm dollar, but bullion remained headed for its biggest weekly rise in eight weeks as US President Donald Trump's Covid-19 positive test hurt risk sentiment.
Spot gold was down 0.2% at $1,901.09 an ounce by 1:00 p.m. EDT (1700 GMT). Prices were on course to rise 2.3% this week, which would be the biggest weekly percentage increase since early August.
US gold futures fell 0.5% to $1,906.80. "The election is 33 days away, there's so much unknown - will it be a mild case, how will he react to it? So we have flight to safety keeping gold afloat," said Bob Haberkorn, senior market strategist at RJO Futures.
"Traders seem cautious because they're concerned about equity markets selling off."
Gold had risen to an over one-week high after Trump said in a tweet that he and his wife Melania had tested positive for the coronavirus, hammering Wall Street. However the White House reassured Americans that the President was "not incapacitated".
Investors also took stock of the last monthly employment report before the Nov. 3 presidential election, which showed US job growth slowed more than expected in September.
"Gold is likely to remain range-bound in the short term. The market will wait through the weekend and look for news," said Tai Wong, head of base and precious metals derivatives trading at BMO.
The dollar too benefited from safe-haven inflows, limiting gold's upside. Focus was also on an elusive US coronavirus relief aid deal. Gold can move back up "if the US congress passes a stimulus bill, that seems to be what this market is hanging on for now," Haberkorn added. Elsewhere, silver eased 0.1% to $23.86 an ounce, platinum dropped 1.9% to $878.78 and palladium rose 0.2% to $2,320.26.
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