Gold prices went up on Monday as the growing number of new COVID-19 cases in several countries boosted the demand for the safe-haven metal. The U.S. dollar plunged near an eight-week low on the expectation that the Federal Reserve will not reduce bond purchases. The weaker dollar made the bullion less expensive for investors using rival currencies.

The new wave of COVID-19 also prompted the inflow of $14.9 billion into money market funds and $16.4 billion into global bond funds.

Spot gold is currently trading at $1,778.68 per ounce as of 0809 GMT.

India set a new world record for new coronavirus cases for three consecutive days. It reported almost one million cases in just three days. The COVID-19 tsunami is forcing hospitals to turn away patients as they are running out of oxygen supply. The government has deployed trains and military planes to deliver oxygen to hard-hit areas. U.S. President Joe Biden said they stand ready to assist India and may even consider sending the unused AstraZeneca vaccines.

In Japan, the government has declared a state of emergency to control the spread of the virus. The measures cover Tokyo, Kyoto and the prefectures of Kyoto and Hyogo and will last until May 11. It is the country’s third state of emergency since the start of the pandemic.

In Israel, the Health Ministry is examining heart inflammation cases in individuals who received Pfizer’s COVID-19 vaccine. Most of the myocarditis cases were among people up to age 30.

DailyFX strategist Margaret Yang noted that the deteriorating COVID-19 situation lifted gold demand and prices. But the upward momentum is kept in check by robust U.S. economic data.

Meanwhile, Newmont Corp. and Barrick Gold Corp. partnership said they would continue to develop Norte Abierto gold-copper project in Chile despite a legal setback. An environmental court ordered a new evaluation of the mine’s impact on a nearby indigenous community.

In physical trading, the surge in coronavirus cases pulled down the demand for the yellow metal in India. In Zimbabwe, the central bank reported that gold production in the first quarter dropped by 30% to 3.98 tons.

In a related development, the U.S. Commodity Futures Trading Commission reported that market speculators raised their bullish stance in COMEX gold contracts for the week that ended on April 20.