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Gold prices rose on Tuesday, supported by a weaker US dollar and Treasury yields, as traders awaited December inflation data and weighed bets for quicker interest rate hikes by the Federal Reserve.

Spot gold rose 0.4% to $1,809.22 per ounce by 0723 GMT. US gold futures were up 0.6% to $1,808.80.

"Pullback in both the US dollar and 10-year treasury yields are supporting gold prices, but the fact that markets are still seeing three to four interest rate hikes this year is limiting the upside potential," said Margaret Yang, a strategist at DailyFX.

The yield on 10-year Treasury notes inched away from an almost two-year high of 1.808% to about 1.757%.

Spot gold may test resistance at $1,801

Gold is considered a hedge against high inflation, but the metal is highly sensitive to rising US interest rates which increase the opportunity cost of holding non-yielding bullion.

Goldman Sachs now expects the US Federal Reserve to raise interest rates four times this year, matching the view of analysts at J.P. Morgan and Deutsche Bank.

The dollar eased against a basket of currencies as traders looked to incumbent Fed Chairman Jerome Powell's nomination hearing later in the day for new clues on the timing and pace of policy normalisation.

"Markets are seeing 5.4% year-on-year growth in core inflation and if numbers surpass this forecast, we may see the dollar moving up even higher and gold prices dropping. However, if the inflation rate comes below expectation, that may provide some relief for gold," Yang said.

US core CPI is expected to have risen by an annual 5.4% in December, up from 4.9% in the prior month, which could stress the need for earlier-than-anticipated rate hikes by the Fed.

Spot silver was up 0.5% to $22.57 an ounce, platinum gained 0.8% to $947.41, and palladium rose 1.2% to $1,934.75.

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