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NEW YORK: Gold prices advanced to a near two-week high on Tuesday, buoyed by mounting inflation concerns and Russia-Ukraine tensions, although expectations for a US interest rate hike limited gains.

Spot gold rose 0.4% to $1,827.03 per ounce by 12:10 p.m. EST (1710 GMT), after hitting its highest since Jan. 26 at $1,828.10 earlier in the session.

US gold futures rose 0.3% to $1,827.40 per ounce, ahead of US inflation data due on Thursday.

“There’s this more of a wait-and-see approach with some of the bigger data that’s coming out later this week. Gold has shown it’s forming massive support around $1,800 and this will be an important week for gold,” said Edward Moya, senior market analyst at brokerage OANDA.

US consumer prices for January are expected to rise 7.3% annually, according to a Reuters poll, after robust labor data last week fanned inflation fears.

Gold prices have been stuck in range-bound trade since the beginning of the year, caught between rising inflation worries and growing expectations for Federal Reserve interest rate hikes.

“If actual (inflation) data issues as expected or higher, the dollar should strengthen along with US Treasury yields leaving gold with substantial downside pressure,” DailyFX analyst Warren Venketas wrote in a note. Gold is highly sensitive to rising US interest rates, which increase the opportunity cost of holding non-yielding bullion. Higher rates also boost the dollar, pressuring the greenback-priced precious metal.

The Russia-Ukraine tensions are going to remain elevated despite some of the optimism from French President Macron, Moya noted.

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