Spot gold was up 0.1 per cent at $1,756.40 per ounce by 0954 GMT. On Monday, bullion hit $1,762.84, its highest since May 18. US gold futures rose 0.3 per cent to $1,771.00.
“Stimulus and fiscal spending are going to continue to go up because the virus hasn’t gone… we’re not out of the woods yet and that’s driving continuous demand for safe havens” especially with the liquidity from central banks starting to stoke inflation, Saxo Bank analyst Ole Hansen said.
Technically, he said a break above the $1,745-$1,765 range “would trigger a chase towards the $1,800 level”.
Global cases of the novel coronavirus surpassed 9 million on Monday.
Gold has gained nearly 16 per cent this year, hitting a 7-1/2 year peak of $1,764.55 last month, supported by global stimulus since the non-yielding metal is considered a hedge against inflation and currency debasement.
Holdings in the SPDR Gold Trust rose 0.58 per cent to 1,166.04 tonnes on Monday, the highest in more than seven years.
While the increase in infection is positive for gold sentiment, demand from the world’s second biggest bullion consumer India is likely to remain paralysed since the country is also seeing a spike in cases, Commerzbank said.
Also helping gold, the dollar edged down 0.2 per cent.
Gold’s gains came despite a rise in equities driven by data showing the downturn in the euro zone economy eased this month and after US President Donald Trump’s tweeted the US-China trade pact was “fully intact”.
Elsewhere, palladium slipped 0.6 per cent to $1,925.93 per ounce, platinum gained 0.6 per cent to $827.14. Silver was steady at $17.82.