Shafaq News/ Gold prices rose on Wednesday as U.S. Treasury yields held close to a one-week low, with bullion shrugging off strength in the dollar following Federal Reserve Chairman Jerome Powell's reassurance that inflation would not spiral out of control.
Spot gold was up 0.2% at $1,730.25 per ounce by 0640 GMT. U.S. gold futures were up 0.2% at $1,728.60 per ounce.
Lower yields "are helping gold stay up, and there is a tough fight going on between bulls and bears around these levels," said Jigar Trivedi, commodities analyst at Mumbai-based broker Anand Rathi Shares.
"The rising dollar is offsetting the dip in the 10-year bond yields," Trivedi added.
Treasury yields slipped to the lowest since March 16, while the dollar jumped above a two-week high after Powell told U.S lawmakers on Tuesday he expected inflation to rise over the year but it would be "neither particularly large nor persistent." [USD/] [US/]
Treasury Secretary Janet Yellen said the U.S. economy remains at risk as she fielded lawmakers' questions about possible infrastructure and tax increase plans under consideration.
"The possibility of higher taxes, whether corporate or individual, tends to raise the demand for bullion as a safe haven," James Steel, chief precious metals analyst at HSBC wrote in a note.
Both Yellen and Powell are also scheduled to testify to the Senate Banking Panel on Wednesday.
"Gold has support nearby at $1,720, and if the U.S. dollar strengthens in Asia and Europe, it could test that level, prompting some stop-loss selling," said OANDA senior market analyst Jeffrey Halley.
Palladium was flat at $2,602.70, silver was up 0.2% at $25.12 and platinum was down 0.2% at $1,166.31.
"Palladium is slightly on the defensive as near-term supplies of the metal appear adequate despite temporary PGM (Platinum Group Metals) mine closures," HSBC's Steel wrote.