PRECIOUS-Gold falls 1% as dollar accelerates rally

Reuters

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 (Updates prices)
    * Powell sees no reason to alter Fed's accommodative stance
    * Platinum falls as much as 4.4%, silver down 3.8%
    * Interactive graphic tracking global spread of coronavirus:
https://tmsnrt.rs/3mvcUoa

    By Shreyansi Singh
    Jan 15 (Reuters) - Gold prices fell more than 1% on Friday
and the metal was heading for a second straight weekly drop as
the dollar continued its upturn, overshadowing bullion's appeal
as an inflation hedge after the U.S. president-elect proposed a
new $1.9 trillion stimulus package.
    Spot gold  XAU=  was down 1% at $1,827.90 per ounce by 1:49
p.m. EST (1849 GMT), having earlier declined as much as 1.3%,
while U.S. gold futures  GCv1  settled down 1.2% at $1,829.90.
    The dollar index was on track for its biggest weekly gain
since October 2020, making bullion more expensive for holders of
other currencies.  USD/ 
    "Bouts of dollar strength and the uptick in U.S. yields have
triggered short-term corrections," said Standard Chartered
Analyst Suki Cooper.  
    "The gold market is caught between longer-term buying on the
back of rising inflation expectations given stimulus measures,
but selling as the dollar has bounced and concern over QE
tapering materialised."
    Benchmark 10-year Treasury yields  US10YT=RR  held close to
near 10-month highs touched earlier in the week.  USD/   US/ 
    "The Biden administration should support a much more
expansive spending agenda than before," said Tai Wong, head of
base and precious metals derivatives trading at BMO.
    "But it seems like the stubborn short-term resilience of the
dollar and concern for even higher yields is triggering steady
liquidation in gold."
    U.S. President-elect Joe Biden on Thursday outlined a $1.9
trillion stimulus package proposal. Biden takes office next
Wednesday. urn:newsml:reuters.com:*:nL1N2JP30B
    While gold is considered a hedge against the inflation and
currency debasement that can result from widespread stimulus, a
recent jump in bond yields has challenged that status as it
increases the opportunity cost of holding non-yielding bullion.
    On the technical front, gold has solid support around
$1,775, and a dip to that level could trigger buying again, said
Michael Matousek, head trader at U.S. Global Investors.
    Silver  XAG=  fell 3.1% to $24.74 an ounce, having earlier
dipped as much as 3.8%. 
    Platinum  XPT=  dipped 3.6% to $1,078.21, having declined
4.4% earlier, while palladium  XPD=  shed 0.7% to $2,391.77.

 (Reporting by Shreyansi Singh in Bengaluru; Editing by Dan
Grebler and Jonathan Oatis)
 ((Shreyansi.Singh@thomsonreuters.com; +91 8061823666/3590 (If
within U.S. call +1 646 223 8780); Reuters Messaging:
Shreyansi.Singh@thomsonreuters.com))

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