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Spot gold rose 0.7% to $1,850.46 per ounce by 0926 GMT,
rebounding from its lowest since Feb. 11 touched earlier in the
session. U.S. gold futures gained 0.6% to $1,852.50.
The dollar dipped 0.5%, but was not far from a two-decade high
touched on Monday, while the benchmark U.S. 10-year Treasury
yields retreated from recent highs. [USD/] [US/]
"Spot gold is seeing some reprieve as the U.S. dollar moderates
and 10-year Treasury yields dip back below 3% ahead of today's
keenly-watched U.S. inflation data," said Han Tan, chief market
analyst at Exinity.
"If U.S. inflation is shown to be climbing persistently, that
could see spot gold break below its 200-day simple moving
average and immediate Fibonacci support level around the
mid-$1,830 region."
Analysts expect a sharp pullback in monthly growth of the U.S.
consumer price index for April, due at 1230 GMT, cooling to 0.2%
from 1.2% in March, for an annual increase of 8.1%.
U.S. central bank officials fortified on Tuesday their arguments
for the swiftest series of interest rate hikes since at least
the 1990s to combat inflation.
If inflation is softer than expected, prices might bounce, with
investors prioritising the data's impact on the Fed instead of
bullion's role as a hedge, according to Ilya Spivak, a currency
strategist at DailyFX.
Rising short-term U.S. interest rates lift the opportunity cost
of holding bullion, while boosting the dollar in which gold is
priced.
Spot silver gained 2.5% to $21.76 per ounce, platinum climbed
2.6% to $988.93, while palladium eased 0.2% to $2,060.96.
(Reporting by Eileen Soreng and Bharat Govind Gautam in
Bengaluru; Editing by Tomasz Janowski)
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