Latest News

UK News

Click Here to read UK News

Forex News

Click Here to read Forex News

Market News

Click Here to read Market News

Irish News
PRECIOUS-Gold scales 1-week high as dollar falters, yields ease
Published at 23/02/2021 at 07:27

* Gold's trend seems to be to the downside - analyst

* Investors await Powell's testimony to Congress

* Silver hits three-week high

(Updates prices)

By Sumita Layek

Feb 23 (Reuters) - Gold climbed to a one-week high on Tuesday, bolstered by a weaker dollar and a retreat in U.S. Treasury yields, while concerns over rising inflation further boosted bullion's appeal.

Spot gold was up 0.1% at $1,810.71 per ounce by 0706 GMT, after hitting its highest since Feb. 16 at $1,815.63 earlier in the session. U.S. gold futures gained 0.1% to $1,810.20.

"One of the few assets that is more out of favour than gold at the moment is the dollar... so that is supporting gold prices by extension," said IG Market analyst Kyle Rodda.

The dollar hit its lowest in more than a month, making gold cheaper for holders of other currencies, as investors await U.S. Federal Reserve Chairman Jerome Powell's testimony to Congress later in the day.

Benchmark U.S. Treasury yields eased from a near one-year peak hit on Monday, reducing the opportunity cost of holding non-yielding bullion.

"Gold's trend seems to be to the downside, and there's no indication that it's reversing for now... until we get a real spike in inflation expectations or a Fed that talks about controlling the yield curve," Rodda said.

Gold, often viewed as an inflationary hedge, rose 1.5% in the previous session, as fears of rising inflation dragged global equities lower.

The European Central Bank on Monday signalled policymakers are becoming uncomfortable with the recent surge in government bond yields.

Gold was "well supported throughout the pandemic as investors sought a haven for funds. But the tide is turning, as interest rates start to rise and investors rekindle their love of bonds," ANZ analysts said in a note.

"However, fixed interest returns may be severely eroded if inflation takes off."

Silver eased 0.4% to $28.05 an ounce, having earlier hit a three-week high of $28.31. Platinum fell 0.8% to $1,262.13, while palladium shed 0.2% to $2,391.55.

(Reporting by Sumita Layek in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)

((; Within U.S. +1 646 223 8780, Outside U.S. +91 8061822693; Reuters Messaging: