Gold slips on stronger dollar, yields; palladium gains

Gold slips on stronger dollar, yields; palladium gains

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Gold prices fell on Wednesday, weighed down by a stronger dollar and U.S. Treasury yields, while palladium gained on supply worries as Western countries ramped up sanctions against Russia over its invasion of Ukraine.

FUNDAMENTALS

* Spot gold was down 0.6% at $2,040.07 per ounce, as of 0054 GMT, after rising to $2,069.89 in the previous session, a whisker away from a record $2,072.49 touched in August 2020.

* U.S. gold futures were up 0.2% at $2,046.40. * Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, rose to 1,067.3 tonnes on Tuesday - their highest since March 2021.

* U.S. Treasury yields surged, bouncing off eight-week lows, as Federal Reserve Chairman Jerome Powell supported raising rates this month. * The dollar index held firm near a more than 1-1/2-year high hit on Monday.

* Gold is highly sensitive to rising U.S. interest rates, which increase the opportunity cost of holding non-yielding bullion. Higher rates also boost the dollar, pressuring the greenback-priced precious metal.

* U.S. President Joe Biden announced a ban on Russian oil and other energy imports on Tuesday, while Britain said it would phase out the import of Russian oil and oil products by 2022.

* Palladium gained 2.9% to $3,272.87 per