* eases off three-week peak
* Platinum dips to more than 1-week low
* Palladium touches near 3-week trough (Recasts, adds comments, updates prices)
By Brijesh Patel
Feb 23 (Reuters) – Gold edged lower in choppy trade on Tuesday as the dollar recovered ground lost in the immediate wake of comments from U.S. Federal Reserve Chairman Jerome Powell, who said the economic recovery was “uneven and far from complete”.
Spot gold was down 0.1% at $1,806.66 an ounce by 12:40 p.m. ET (1740 GMT), after briefing moving into positive territory as the dollar dipped following Powell’s comments. U.S. GCv1 eased 0.1% to $1,806.20.
Powell said it will be “some time” before the Fed considers changing policies it adopted to help the economy get back to full employment and “does not expect inflation to rise to troubling levels”. been a little volatility around Powell’s Senate appearance but he hasn’t really said anything to rock the boat,” OANDA analyst Craig Erlam said.
“Despite the volatility, we haven’t seen any significant directional movement in yields or the dollar, which is why gold is only marginally lower, a reflection of the dollar being a little higher.”
The crawled back up 0.2%, moving away from near a six-week low, making gold more expensive for holders of other currencies. USD/ .N
But gold might not reverse course to gain substantially “until we get a real spike in inflation expectations or a Fed that talks about controlling the yield curve”, said IG Market analyst Kyle Rodda. MKTS/GLOB
Rising yields have challenged bullion’s appeal as an inflation hedge, since they increase the opportunity cost of holding gold. US/
Gold jumped 1.5% on Monday as prospects of rising inflation triggered equity valuation concerns and drove investors towards the safe-haven metal.
Silver dropped 1.8% to $27.64 an ounce, having earlier hit a three-week peak at $28.31.
Platinum slipped 3.1% to $1,233.04, after touching a more than one-week low earlier in the session. Palladium lost 2.3% to $2,340.11.