PRECIOUS-Gold hits 3-week peak as Fed's dovish tone pressures dollar, yields

* Fed committed to support economy until recovery more
secure
* Markets eye Powell's speech at IMF conference
* Silver hits over two-week peak

(Updates prices)
By Sumita Layek
April 8 (Reuters) - Gold scaled a three-week peak on
Thursday after minutes from the Federal Reserve's latest policy
meeting reassured investors that interest rates will remain low
for some time, pushing the dollar and U.S. yields lower.
Spot gold XAU= rose 0.5% to $1,746.21 per ounce by 1213
GMT, having earlier hit a high since March 18 at $1,751. U.S.
gold futures GCv1 gained 0.5% to $1,750.20.
"The Federal Open Market Committee (FOMC) are clearly
committed to maintaining a very dovish policy, which has helped
put some downward pressure on the dollar and yields and is
helping gold," said independent analyst Ross Norman.
"It's quite clear that the Fed feels that the unemployment
situation is still difficult, and they will resist any
temptations to edge rates higher in the interim."
Fed policymakers remain wary about the ongoing risks of the
coronavirus pandemic and are eager to reach employment and
inflation goals, minutes of the U.S. central bank's latest
policy meeting showed on Wednesday. The dollar .DXY fell against major rivals, while benchmark
Treasury yields also eased, making gold more affordable as well
as appealing compared with alternative investments like bonds.
Easy monetary policy tends to weigh on government bond
yields, increasing the appeal of non-yielding gold.
However, despite the Fed's assurance, expectations of a
sooner than expected rate hike were making rounds.
"Investors are expecting the Fed will have to hike interest
rates as early as January 2022 as it becomes a huge task once
inflation starts going out of control," said Michael McCarthy,
chief market strategist at CMC Markets.
Market participants now await Fed Chair Jerome Powell's
speech at a virtual International Monetary Fund conference later
on Thursday.
Silver XAG= rose 0.8% to $25.33 per ounce, having hit a
more than two-week peak of $25.48. Palladium XPD= added 0.2%
to $2,628.20, while platinum XPT= climbed 0.4% to $1,230.56.