2020.05.0411:14:00UTC+00Gold Prices Rise As Risk Sentiment Sours

Gold prices edged higher on Monday as rising U.S.-China tensions over the coronavirus as well as weak manufacturing PMI numbers from Asia and Europe dented investors' appetite for riskier assets and bolstered bullion's safe-haven appeal.

Spot gold rose 0.3 percent to $1,704.85 per ounce, while U.S. gold futures were up 0.8 percent at $1,714.60.

Trade war fears returned to the fore after U.S. Secretary of State Michael Pompeo said that there is 'enormous evidence' that the novel coronavirus outbreak began in a laboratory in Wuhan, and that Beijing has refused to give international scientists access to learn what happened.

According to a four-page Department of Homeland Security report, U.S. officials believe China covered up the extent of the coronavirus outbreak so it would have time to hoard medical supplies.

China's Global Times said in an editorial that Pompeo was "bluffing" and called on the United States to present its evidence.

Weak manufacturing data from Asia and Europe also raised fears of a severe recession.

April Manufacturing PMI's from India, Indonesia, Malaysia, Myanmar, Philippines, South Korea, Taiwan and Vietnam all collapsed to hit historic lows, raising fears of prolonged coronavirus downturn.

In Europe, the final Purchasing Managers' Index fell to 33.4 from 44.5 in March. The score was also below the flash estimate of 33.6.