Bullion traded near the highest since 2012 after the US Federal Reserve voiced concern Wednesday the crisis could leave permanent scars on the US economy, while leaving interest rates near zero. The European Central Bank will decide Thursday if more action is needed amid the historic pandemic-led slump.

Gold has rebounded after a sell-off last month, when investors rushed to raise cash.

There was also some delayed quarterly portfolio rebalancing pushed back due to those late-March falls, Rhona O’Connell, head of market analysis for EMEA and Asia at INTL FCStone, said by email.

“Additional liquidity in the system benefited gold,” she said. “The risks in the system do point to further gains but I would expect that some of the momentum will fade away.”

Gold’s been under pressure this week as many economies are edging toward reopening, while investors are also weighing signs of progress in treating the coronavirus following Gilead Sciences Inc saying its experimental drug helped Covid-19 patients recover faster. The Food and Drug Administration plans to authorise emergency use of the drug, the New York Times reported.

Spot gold was up 0.3% at US$1,717.90 an ounce at 10.03am in London, ahead of a long weekend for some markets, including China and most of Europe. Gold futures for June delivery advanced 1% on the Comex to US$1,730.40.

Overall sentiment for gold is still high, as investors seek havens amid the economic downturn, and monetary and fiscal stimulus, according to State Street Global Advisors.

Gold will trade between US$1,700 and US$1,800 an ounce for the next few weeks, with a skew to the higher end of that range, Robin Tsui, Asia-Pacific gold strategist, said in an interview. “The low interest rate factor is going to drive gold prices forward.”

In other precious metals, spot silver and platinum have also risen in April, while palladium is set for the biggest monthly loss since 2015.