At the start of a fresh trading week, gold prices continue to hold steady above the key $1,700 level as markets worried about a resurgence in the number of coronavirus cases, especially in China and South Korea. At the time of writing, GOLD is trading at a little above $1,708.

Despite equities trading higher and the US dollar also gaining some strength, the safe haven appeal of gold remains supported over fears that countries could experience a second wave of infections as they restart economic activity in the coming days and weeks. There has been a sudden spurt in reported cases across China, South Korea and Germany after they eased lockdown restrictions and resumed economic activity.

Meanwhile, worries about the economic fallout from the pandemic continue to dominate the market sentiment after the IMF cautioned that global economic forecasts will have to be revised further lower as the crisis continues. It has also warned that a resumption of the US-China trade war could worsen the chances of economic recovery worldwide.

Gold also remains in favour on the back of weak economic data releases from around the world recently. While US unemployment soared to a historic high of 14.7% during April, Germany saw exports fall by 11.8% in March, reinforcing tensions about the economic impact of the coronavirus pandemic.