PRECIOUS-Gold recovers from 9-month low as U.S. yields retreat

* Gold in oversold territory on technical front -analyst
* Holdings of SPDR Gold hit lowest since April 2020 on
Monday

(Adds graphic, updates prices)
By Sumita Layek
March 9 (Reuters) - Gold prices rose on Tuesday, as a
pullback in U.S. Treasury yields added some lustre to the metal
after it hit a nine-month low in the previous session.
Spot gold XAU= rose 0.7% to $1,692.21 per ounce by 0703
GMT. Prices had fallen more than 1% on Monday to $1,676.10,
their lowest since June 5.
U.S. gold futures GCv1 climbed 0.7% to $1,690.30.
"Dip buyers have emerged after the 1.15% fall overnight and
U.S. bond yields have slightly eased, which has provided support
for precious metals," OANDA senior market analyst Jeffrey Halley
said.
U.S. 10-year Treasury yields US10YT=RR edged lower,
raising the appeal of holding gold. A steady rise in bond yields
makes holding gold less attractive as investors typically tend
to gravitate toward assets that generate steady income in the
form of interest or dividend.
"In an environment of rising U.S. yields, growth recovery,
vaccine rollouts, and investors getting more optimistic on
growth prospects; demand for safe havens will struggle," said
Lachlan Shaw, National Australia Bank's head of commodity
research.
While the U.S. Federal Reserve has downplayed the rise in
yields so far, the European Central Bank will discuss on
Thursday the merits of intervening.
"Central banks will need to try and strike a balance between
yields reflating in a reasonable fashion at a reasonable speed,
compared to the recovery in economic activity, and so there may
be tweaks along the way," Shaw said.
Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust GLD , fell to their lowest since April
2020 on Monday. GOL/ETF
"Gold's short-term technicals have dipped into oversold
territory, which should provide some temporary support over the
session, however gains are likely to be limited to the $1,700
region," OANDA's Halley said.
Silver XAG= rose 0.8% to $25.30 an ounce. Palladium XPD=
climbed 0.3% to $2,322.68. Platinum XPT= gained 0.8% to
$1,144.49.

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