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Gold inched up on Thursday on worries about the economic impact of the coronavirus outbreak as the United States suspended travel from virus-hit Europe, although gains were capped as traders covered margin calls after a plunge in equities.

Spot gold was up 0.1% at $1,636.37 per ounce by 0415 GMT, having risen as much as 0.9% earlier in the session. US gold futures fell 0.4% to $1,636.30.

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The travel ban "is a big surprise and a big shock to the market" and shows that investors are yet to see the full financial fallout from the coronavirus outbreak, said IG Markets analyst Kyle Rodda. On the flip side, traders are selling gold to fund margin calls, providing a headwind for the metal, Rodda added.

US President Donald Trump on Wednesday announced the suspension of all travel from Europe, except from the United Kingdom, to the United States for 30 days, leading to a sell-off in global stock markets and the dollar.

Reuters