Gold consolidates within narrow ranges as investors await BoE policy meeting outcome

Gold prices consolidated within narrow ranges as worries over new coronavirus cases delaying economic recovery weighed on market sentiment. Moreover, strengthening U.S. dollar and a pullback in global equities supported the metal's safe-haven appeal.

Spot gold was trading flat at $1,726.76 per ounce by 0736 GMT, having touched a high of $1,744.91 last week, its highest since June 2. U.S. gold futures were nearly unchanged at $1,734.70.

Asian shares and Wall Street futures declined as increasing coronavirus cases in some U.S. states and China offset hopes of a quick global economic recovery from the pandemic. The daily count of infections hit a new benchmark in California and Texas, while Florida and Arizona also recorded the second-highest daily increases.

Beijing cancelled a number of flights, shut schools and blocked off some neighbourhoods as it ramped up efforts to contain a coronavirus outbreak that stoked fears of wider contagion.

The Australian dollar slumped after data showed the economy shed a quarter of a million jobs and the jobless rate increased to the highest in almost two decades in May, while the New Zealand dollar plunged as the NZ economy shrank more than expected in the first quarter.

The greenback against a basket of currencies traded 0.05 percent down at 97.11, having touched a low of 95.72 on Wednesday, its lowest since March 10. The U.S. Treasury yields declined, with the key 10-year note yield trading at 0.713 percent, compared to Wednesday’s U.S. close of 0.743 percent.

Investors now await the Bank of England’s policy meeting, where it is expected to announce an increase of at least 100 billion pounds ($125 billion) in its bond-buying programme to cushion the economy from the pandemic fallout.