PRECIOUS-Gold slides to 9-month low as rising bond yields, dollar dim appeal

* U.S. Senate to debate $1.9 trillion stimulus package this
week
* Silver, platinum slip more than 1%
* Yields move higher after 3-day stall

(Updates prices)
By Brijesh Patel
March 3 (Reuters) - Gold slid more than 2% to its lowest in
nearly nine months on Wednesday as elevated U.S. Treasury yields
and a stronger dollar hammered the metal's appeal.
Spot gold XAU= was down 1.2% at $1,717.67 per ounce by
01:46 p.m. ET (1846 GMT), after falling to its lowest since June
2020 at $1,701.40 earlier in the session.
U.S. gold futures GCv1 settled 1% down at $1,715.80.
"As real rates continue to rise, that's challenging gold.
The rates markets are also adding pressure on valuations for all
asset classes, and as a result, gold is a casualty," said TD
Securities commodity strategist Daniel Ghali.
Benchmark U.S. 10-year Treasury yields US10YT=RR crept
back towards a one-year peak reached last week, while the dollar
.DXY rose. US/ USD/]
Hopes of a quick economic rebound fuelled by a swift rollout
of COVID-19 vaccines also prompted an outflow of safe-haven
assets like gold from investors' portfolios. MKTS/GLOB
Progress on the $1.9 trillion U.S. stimulus bill has offered
little respite, as higher yields have threatened gold's appeal
as an inflation hedge by increasing the opportunity cost of
holding bullion. "The outlook for gold is tied really to whether or not we've
reached that pivot point at the U.S. Federal Reserve in terms of
whether they would address the steepening of the yield curve.
But we're still early in that process, so that has negative
short-term implications on gold," Ghali said.
Fed officials have reiterated that U.S. interest rates will
remain low but cited a recent rise in real rates as a sign of
growing optimism about an economic recovery. "We anticipate recent headwinds to intensify again into the
second half of this year, particularly as greater U.S. stimulus
raises the prospect of an earlier-than-planned Fed rate hike,"
UBS analysts wrote in a note. Silver XAG= fell 1.8% to $26.28 an ounce and platinum
XPT= slipped 2.1% to $1,178.79. Palladium XPD= rose 0.1% to
$2,364.02.