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Gold prices hit their highest in almost a month on Thursday, drawing support from a subdued dollar and US bond yields as investors assessed whether the Federal Reserve would tighten its monetary policy as early as anticipated.

Spot gold rose 0.3% to $1,797.27 per ounce by 0920 GMT, having earlier hit its highest since Sept. 15 at $1,797.31. US gold futures gained 0.2% to $1,797.90.

Both the dollar and benchmark US 10-year Treasury yields were subdued on Thursday. A weaker dollar makes gold cheaper for buyers in other currencies and lower yields decreases the opportunity cost of holding non-interest bearing gold.

Independent analyst Ross Norman described gold's rally as "constructive", but said it had to breach key technical resistance around $1,800 and $1,835, before another substantial move higher.

Banks prepare to scrap LME gold and silver contracts

Investors took note of data showing Chinese producer prices posted a record annual increase last month and U.S consumer prices increased solidly, which also fanned fears central banks might unwind their economic support and hike interest rates sooner.

Minutes from the US Federal Reserve's September meeting showed it could start reducing stimulus by mid-November.

But, "now that we've got a little bit of visibility on what the Fed intends to do in terms of tapering and it's a relatively small amount; that's been positive for gold," Norman said, noting uncertainty over the taper timeline had weighed on gold.

While gold is considered a hedge against higher inflation, reduced central bank stimulus and interest rate hikes tend to push government bond yields up, raising the opportunity cost of hold bullion.

"Should market participants continue ditching 'team transitory' as stagflation fears ramp up, gold prices could catch strong bids from safe haven plays and as a hedge against stubbornly elevated consumer prices," Han Tan, chief market analyst at Exinity said.

Spot silver rose 0.9% to $23.28 per ounce, platinum gained 1.6% to $1,036.52 and palladium jumped 3.7% to $2,184.26.

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