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Gold consolidated above $1,800 on Tuesday as some investors bet the recent surge in COVID-19 cases could steer the U.S. Federal Reserve away from announcing at its Jackson Hole symposium that it plans to taper its economic support.

· Spot gold was steady at $1,804.99 per ounce by 1:47 p.m. EDT (1747 GMT), having earlier hit its highest since Aug. 5.

· U.S. gold futures settled up 0.1% at $1,808.90.

· SPDR GOLD HOLDINGS: THIRD DAY, SELL MORE 10 TONNES

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings 2.03 Tonnes to 1,004.63 tons on Tuesday from 1,006.66 tons on Monday.

· “The tenure of the marketplace has pivoted from thinking the Fed would lean hawkish at Jackson Hole symposium to one of the coronavirus keeping the Fed from doing anything as soon as they might have wanted to, and maybe even this year,” said Jim Wyckoff, senior analyst at Kitco Metals.

Reflecting the economic impact of the virus was data showing U.S. business activity growth slowed in August.

“What might be gold-market sensitive is the Fed might start to say inflation isn’t as transitory as thought and that could prompt them to tighten policy down the road, though the impact of the virus should override inflationary concerns for now.”

· Fawad Razaqzada, market analyst with ThinkMarkets, also noted that $1,805-$1,810 was significant for gold since the bearish trend line converges with the 200-day average there.

“We may see a potential drop, not least on profit-taking, to the next support around $1,795 and if gold takes out Monday’s low at $1776, that could trigger fresh technical selling.”

· Gold’s latest uptick came despite outflows from exchange-traded funds.

· “Even though short-term hiccups to economic activity are a risk to watch, a renewed recession, bringing lasting support to gold, still seems very unlikely,” said Carsten Menke, head of Next Generation Research, Julius Baer, in a note.

· Silver rose 0.9% to $23.86 per ounce.

· Platinum fell 0.1% to $1,012.5.

· Palladium was up 2.1% at $2,451.18.

· Powell in focus

Powell is due to speak at the Fed’s annual economic symposium at Jackson Hole, Wyoming. The event on Aug. 27 will take place virtually and not in person due to the spread of COVID-19 in the county, which has reduced expectations that any major announcement will be made at the event.

Still, investors will be watching to see if Powell indicates that a reduction in bond purchases is imminent, and whether he expresses any new concerns about economic growth due to the rise in COVID-19 Delta variant cases.

· Facing divisions, U.S. House Democrats postpone vote on $3.5 trln Biden plan

· Goldman Sachs raises odds on U.S. Fed taper announcement in Nov

Goldman Sachs economists have raised the odds that the U.S. Federal Reserve will announce the start of tapering its bonds purchases in November, predicting the central bank will likely opt to dial back purchases by $15 billion then and at meetings that follow.

· U.S. new home sales creep up; supply, prices remain constraints

Sales of new U.S. single-family homes increased in July after three straight monthly declines, but housing market momentum is slowing as surging housing prices amid tight supply sideline some first-time buyers from the market.

New home sales rose 1.0% to a seasonally adjusted annual rate of 708,000 units last month. June's sales pace was revised up to 701,000 units from the previously reported 676,000 units.

· Two-thirds of Japan's smaller firms' sales still below pre-COVID level -survey

Almost 68% of small and medium-sized Japanese companies posted lower sales in July than in the same month of pre-pandemic 2019, according to a survey by credit research firm Tokyo Shoko Research released Tuesday.

· Biden pushes for Aug. 31 Afghanistan pullout as threat of attacks rise

· Taliban will no longer allow Afghans to go to Kabul airport for evacuation, spokesman says

· China’s engagement with the Taliban will be driven by security interests, says British lawmaker

China will likely engage with the Taliban to achieve two crucial goals — set up an economic corridor with Afghanistan and ensure stability in its neighborhood, according to Tom Tugendhat, a British Member of Parliament.

“I’m sure Beijing will be looking to open up an economic corridor in a similar way they tried to do in Pakistan,” Tugendhat, leader of the U.K. government’s China Research Group and chairman of the Foreign Affairs Select Committee, told CNBC’s Sri Jegarajah.