- Spot gold rose 0.5pc to $1,735.24 per ounce by 12:48 P.M EDT (1648 GMT). U.S. gold futures gained 0.6pc to $1,734.90.
Gold gained on Wednesday, taking an uptick in U.S. Treasury yields and the dollar in stride, as the safe-haven metal drew support from Federal Reserve Chair Jerome Powell's repeated calls to keep low-interest rates pinned near zero.
Spot gold rose 0.5pc to $1,735.24 per ounce by 12:48 P.M EDT (1648 GMT). U.S. gold futures gained 0.6pc to $1,734.90.
"The Fed said that despite the fact that we could see some higher inflation, they will look past it so that ultimately means we could see a spike in inflation and the Fed remaining on the sidelines ... those factors are helping gold here," said Bart Melek, head of commodity strategies at TD Securities.
Fed chair Powell told lawmakers on Tuesday he expected some inflation but that would be "neither particularly large nor persistent."
The U.S. central bank pledged to keep interest rates anchored near zero in its policy meeting last week.
Meanwhile, concerns over extended lockdowns across the euro zone and a dispute over the supply of COVID-19 vaccines also helped prop up gold's safe-haven appeal to some extent.
Gold's gains came despite benchmark 10-year U.S. Treasury yields and the dollar ticking up. A stronger dollar makes holding gold more expensive for other currency holders.
Although gold is considered a hedge against rising inflation, higher yields have challenged that status of late since they translate into higher opportunity cost of holding the non-yielding bullion.
But gold is unlikely to move out of the $1,700-to-$1,750 range until later in the year when growth and inflation likely stalls with investors likely favouring assets and commodities that track higher inflation until then, said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.
Elsewhere, palladium gained 1.3pc to $2,638.03 per ounce and silver rose 0.7pc to $25.25. Platinum climbed 1pc to $1,180.01.