PRECIOUS-Gold rises as investors focus on big U.S. stimulus bets

(Recasts, adds comments, updates prices)
* 10-year Treasury yields hover near highest since March
* Investors await progress on U.S. COVID-19 relief package
* Interactive graphic tracking global spread of coronavirus:
https://tmsnrt.rs/3mvcUoa

By Shreyansi Singh
Feb 8 (Reuters) - Gold rose on Monday as investor focus
returned to prospects of a substantial U.S. stimulus package,
which bolstered bullion's appeal as an inflation hedge and
offset pressure from a resultant rally in equities and a firmer
dollar.
Spot gold XAU= rose 0.8% to $1,825.69 per ounce by 1258
GMT. U.S. gold futures GCv1 also added 0.6% to $1,822.90.
President Joe Biden and his Democratic allies in Congress
cleared the path for their $1.9 trillion COVID-19 relief package
as lawmakers approved a budget outline that will allow them to
muscle Biden's plan through in the coming weeks without
Republican support. "Gold is drawing strength from the renewed optimism over
U.S. stimulus plans and rising inflation expectations," said
Lukman Otunuga, senior research analyst at FXTM.
"The metal continues to be pulled and tugged by conflicting
forces," and while gold bulls remain protected by the 'reflation
trade', stimulus hopes continue to lift the market mood and
overall risk sentiment, Otunuga added.
World shares hit a record high on Monday on hopes that
the$1.9 trillion COVID-19 aid package will be passed by U.S.
lawmakers as soon as this month. MKTS/GLOB Bullion is finding some supportive sentiment from U.S.
Treasury Secretary Janet Yellen "talking quite aggressively"
about stimulus, although the relief package might not come until
March, said StoneX analyst Rhona O'Connell.
Gold's gains came despite a slightly higher dollar .DXY
that makes bullion more expensive for buyers with other
currencies. USD/ Terming gold's uptick a likely corrective move from last
week's selloff, when prices slid below the key $1,800 level,
OANDA analyst Craig Erlam said the $1,830 mark posed a key
technical resistance.
Limiting gold's upside, benchmark 10-year Treasury yields
US10YT=RR hovered near their highest since March last year,
increasing the opportunity cost of holding non-yielding bullion.
US/
Among other precious metals, spot silver XAG= gained 1.3%
to $27.17 an ounce, platinum XPT= rose 2.8% to $1,155.12 and
palladium XPD= added 0.6% to $2,351.18.