Gold pushed towards the highest level since 2012, lifted by concerns over a second wave of coronavirus infections and growing uncertainty in Hong Kong after China released details of a proposed national security law.
Bullion was supported as cases across the United States' Sun Belt surged, while Germany's infection rate rose, and Australia's second-most populous state, Victoria, tightened curbs following a spike in cases.
Meanwhile, China confirmed the proposed national security law would allow Beijing to override Hong Kong's legal system, likely adding to tensions with the US.
Gold is up 15 per cent this year, buoyed by unprecedented stimulus to aid the global economy hurt by the coronavirus-related lockdowns.
The metal continues to garner positive commentary, with Goldman Sachs Group forecasting it will hit a record US$2,000 an ounce, while JPMorgan Chase & Co said investors should stick with bullion as it is most leveraged to a low real-yield environment.
"Markets have been optimistic lately, looking through poor data and news flow and betting on a strong recovery, but the one thing markets wouldn't be able to ignore is economies stalling again and the threat there is a second round of lockdowns," said research strategist Sean MacLean at Pepperstone.
"Then we have that proposed national security law, which is dangling bait for the Trump administration to bite at."
Spot gold was up 0.3 per cent at US$1,748.41 an ounce by 10.55 am in London, after touching the highest since May 18, when prices reached a level last seen in 2012.
Total known holdings in bullion-backed exchange-traded funds rose by almost 30 tons on Friday, according to initial data compiled by Bloomberg.
Of that inflow, 23.1 tons went into SPDR Gold Shares, the most in a year in tonnage terms.
Silver climbed 1.5 per cent, platinum gained 0.6 per cent, and palladium added 0.2 per cent.
"Covid-19 worries together with the eventual inflationary impact of central bank stimulus are providing the support for gold," said head of commodity strategy Ole Hansen at Saxo Bank.
BLOOMBERG
