Gold holds tight range on investor caution over Powell remarks

Gold holds tight range on investor caution over Powell remarks

 Gold steadied in a tight range on Wednesday, propped up by a subdued dollar, as investors digested monetary policy cues from Federal Reserve Chair Jerome Powell.Spot gold was up 0.1% at $1,807.51 per ounce by 1049 GMT. U.S. gold futures were steady at $1,805.60.Powell told the U.S. Senate Banking Committee that monetary policy still needed to be accommodative with economic recovery "uneven and far from complete". His testimony continues later in the day. He also mentioned that the increase in yields was due to higher inflation and growth expectations. "Powell did say that the recent run-up in bond yields was a statement of confidence in the U.S. economy, and that ... could mean the Fed is willing to allow rates to run even higher, which will create a challenge for gold," Saxo Bank analyst Ole Hansen said."For gold to recover again, it needs to be the inflation focus. The focus has faded and has been substituted by the current nervousness about the yields going higher."U.S. Treasury yields hovered close to a one-year high, while the dollar .DXY held near the six-week low of 89.941 it reached overnight. Rising yields tend to hurt bullion's appeal as an inflation hedge since they increase the opportunity