Gold hovers near 1-week peak as Treasury yields retreat

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Gold prices hovered near a one-week peak

on Tuesday after gaining 1.5% in the previous session, as U.S.

Treasury yields retreated, lifting the appeal of the bullion.

FUNDAMENTALS

* Spot gold rose 0.1% to $1,809.57 per ounce by 0057

GMT, having hit its highest since Feb. 16 at $1,812.31 on

Monday. U.S. gold futures gained 0.1% to $1,809.30.

* The dollar reached multi-year lows on Monday against the

British pound and the Australian dollar as traders focused on

the promise of coronavirus vaccinations and economic growth

outlook.

* Benchmark U.S. Treasury yields eased from a

near one-year peak on Monday. Higher yields increase the

opportunity cost of holding bullion.

* U.S. President Joe Biden on Monday launched changes to the

U.S. coronavirus aid program for small businesses to try to

reach smaller and minority-owned firms.

* The advancement of a proposed $1.9 trillion U.S. COVID-19

relief bill added to concerns about inflationary pressures. Gold

is often viewed as a hedge against inflation.

* The European Central Bank is “closely monitoring” the

recent rise in government bond yields, ECB President Christine

Lagarde said on Monday, the clearest sign yet that policymakers

are becoming uncomfortable with the recent surge in borrowing

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costs.

* Bitcoin fell on Monday after surging to its latest record

high a day earlier as a sell-off in global equities curbed risk

appetite.

* The United States on Monday crossed the staggering

milestone of 500,000 COVID-19 deaths.

* Investors now await the testimony of U.S. Federal Reserve

Chairman Jerome Powell on the Semiannual Monetary Report to

Congress on Tuesday.

* SPDR Gold Trust , the world’s largest gold-backed

exchange-traded fund, said its holdings fell 1.1% to 1,115.4

tonnes on Monday.

* Silver eased 0.4% to $28.04 an ounce. Platinum

shed 0.4% to $1,267.46, while palladium climbed

0.3% to $2,401.52.

(Reporting by Sumita Layek in Bengaluru;

Editing by Vinay Dwivedi)