PRECIOUS-Gold prices ease as firmer dollar dampens safe-haven appeal

* Dollar hovers close to a near two-week peak
* Palladium soared to record high on Tuesday
* Platinum slips from over two-month peak

(Recasts, adds comments, and updates prices)
By Shreyansi Singh
May 5 (Reuters) - Gold prices edged lower on Wednesday as a
stronger dollar and prospects of higher U.S. interest rates
dampened the allure of the safe-haven metal, while palladium
held firm after scaling a record peak in the previous session.
Spot gold XAU= was down 0.1% at $1,776.71 per ounce by
0711 GMT. U.S. gold futures GCv1 were steady at $1,775.90.
"A stronger dollar and Treasury Secretary Yellen's rate-hike
comments overnight continue to weigh on sentiment in Asia, with
multiple failures ahead of the $1,800 an ounce region," OANDA
senior market analyst Jeffrey Halley said.
The dollar index .DXY turned positive and was hovering
close to a near two-week peak against its rivals. USD/
Yellen on Tuesday said she sees no inflation problem
brewing, downplaying earlier comments that rate hikes may be
needed to stop the economy overheating as U.S. President Joe
Biden's spending plans boost growth. Higher interest rates dull gold's appeal as it increases the
opportunity cost of holding non-yielding bullion.
Investor focus is expected to shift to April payrolls data
due on Friday for further cues on the health of the U.S.
economy.
So far, Federal Reserve Chair Jerome Powell has argued the
labour market is still far short of where it needs to be to
start discussing tapering asset buying.
Elsewhere, palladium XPD= rose 0.5% to $2,999.49 per ounce
after hitting an all-time high of $3,017.18 in the previous
session, driven by concerns of a shortage of the metal.
"Rallies in palladium and platinum are being driven by
disrupted or limited supply of both metals meeting a huge jump
in demand by car manufacturers," Halley said. Palladium, used mainly in emission-reducing auto catalysts
for vehicles, has risen more than 22% so far this year.
Silver XAG= was down 0.8% at $26.33, while platinum XPT=
eased 0.9% to $1,227.02 after hitting its highest level in more
than two months on Tuesday.