April 20 Reuters Gold prices inched higher on Tuesday, hovering below a sevenweek peak hit in the previous session, bolstered by a pullback in U.S. Treasury yields and a weaker dollar.
Spot gold was up 0.1 to 1,770.40 per ounce at 1215 GMT, after hitting 1,789.77 on Monday, its highest since Feb. 25. U.S. gold futures climbed 0.1 to 1,772.70 per ounce. The fact that the bond market has seemed to stabilise a little bit is helping gold, said StoneX analyst Rhona OConnell.
Benchmark 10year U.S. Treasury yields fell below 1.6, reducing the opportunity cost of holding nonyielding bullion.
A weaker dollar provided further support to gold. The dollar index hit a nearly sevenweek low against its rivals, making gold less expensive for holders of other currencies.
Gold can still move higher as there is too much liquidity in the market and it is going to stay that way for quite some time, even though we have got the green shoots of recovery looking quite strong in certain regions, OConnell added.
Bullion, also considered a hedge against inflation, has shed over 6 so far this year as higher bond yields have dulled the appeal of the nonyielding commodity. Bullion rose 25 last year.
On a technical note, golds failure to break resistance at 1,785 may drive it back to a range of 1,744 to 1,758 per ounce, Reuters technical analyst Wang Tao said.
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