Gold rose more than 1 per cent on Monday 02 Mar 2020

Gold rose more than 1 per cent on Monday, recouping losses from a steep slide in the previous session, amid the fast-spreading coronavirus and hopes for a rate cut by the US Fed.

Spot gold gained 0.9 per cent to $1,599.15 per ounce as of 0401 GMT, having risen over 1 per cent earlier in the session. US gold futures rose 2.2 per cent to $1,601.20.

Gold plunged over 4.5 per cent on Friday, with precious metals joining a broader market selloff as investors liquidated positions to meet margin calls in other assets.

"On Friday, the US Federal Reserve board hinted they're going to be dropping interest rates and that's a great thing for gold right off the bat," said Stephen Innes, chief market strategist at financial services firm AxiCorp.

Fed Chair Jerome Powell said that while the US economy remained strong, the corona virus "posed an evolving risk" and the central bank stood ready to take action if needed.

Lower interest rates reduce the opportunity cost of holding non-yielding bullion.

Gold rose more than 1 per cent on Monday, recouping losses from a steep slide in the previous session, amid the fast-spreading coronavirus and hopes for a rate cut by the US Fed. 

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