Gold pares gains as U.S. yields climb; focus on Powell speech

Gold prices pared gains on Wednesday due to an uptick in the U.S. bond yields ahead a much awaited speech from Federal Reserve Chair Jerome Powell, although a weaker dollar kept bullion on track for its best month since May 2021.

Spot gold was up 0.1% at $1,751.86 per ounce by 10:16 a.m. ET (1516 GMT), after rising as much as 0.9% earlier in the session. U.S. gold futures rose 0.7% to $1,760.70.

Meanwhile, bullion is set for a 7.3% monthly rise, following a seven-month losing streak.

Ryan McKay, commodity strategist at TD Securities, said they are seeing a lower dollar and markets are now pricing in just about a 50-basis-point hike from the Fed in the next meeting.

However, "ultimately the gold market is still quite vulnerable to a hawkish Fed. I don't think this is the start of a new bull trend or anything in gold just yet."

U.S. bond yields rose after data showed the world's largest economy grew more than expected in the third quarter, increasing the opportunity cost of holding non-interest bearing gold. [US/]

Putting a floor under gold prices, the U.S. dollar index fell 0.3% against its rivals and was heading for its biggest monthly drop over a decade. [USD/]

All eyes were on Powell's upcoming speech at a Brookings Institution event at 1830 GMT for any indication on the central bank's policy strategy ahead of its December meeting.

"Gold should find strong resistance at the $1,800 level but if (Powell) eases up on the hawkish rhetoric, it could make a run for the $1,825 level," Edward Moya, senior analyst with OANDA, said in a note.

Spot silver rose 1.4% to $21.56 per ounce, on course for its best monthly gain since December 2020.

Platinum gained 2.1% to $1,022.86, en route to its biggest monthly gain since February 2021.

Palladium rose 1.2% to $1,855.50, rising to $1,933.04 earlier, and was up about 1.4% for the month.