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Spot gold was down 0.2% at $1,941.95 per ounce, as of 0452 GMT,
after hitting a more than one-week high of $1,949.32 earlier in
the day. U.S. gold futures were flat at $1,945.70.
"Gold is still trading sideways and that reflects the
conflicting currents that we're looking at. There's still real
concern about the geopolitical outlook and the potential for
escalation in Ukraine," said Michael McCarthy, chief strategy
officer at Tiger Brokers, Australia.
"At the same time, a stronger U.S. dollar and potential for
higher interest rates around the globe are keeping a lid on
enthusiasm for gold."
The U.S. dollar index was up after topping 100 for the first
time in nearly two years on Friday, bolstered by prospects of
aggressive rate hikes by the U.S. Federal Reserve to contain
soaring inflation. [USD/]
A stronger dollar makes gold less attractive for other currency
holders.
The benchmark 10-year yield added another seven basis points to
hit a more than three-year high of 2.77%, as the Fed readies to
cut its asset holdings and move interest rates sharply higher.
[US/]
Higher U.S. interest rates and yields increase the opportunity
cost of holding bullion, which is also used as a hedge against
rising inflation.
Russian forces pounded targets in eastern Ukraine with missiles
and artillery on Sunday, lending some support to the safe-haven
metal.
Palladium was up 2.6% at $2,487.83 after hitting a more than
two-week high earlier in the session.
The auto-catalyst metal had gained 8.6% on Friday after newly
refined Russian platinum and palladium were suspended from
trading in London, the metals' biggest trade hub.
Spot silver shed 0.2% to $24.69 per ounce and platinum rose 0.5%
to $979.97.
(Reporting by Asha Sistla in Bengaluru; Editing by Subhranshu
Sahu)
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