PRECIOUS-Gold edges up as dollar and Treasury yields ease

* Investors favour other assets to hedge inflation -analyst
* U.S. Fed officials prepared to keep monetary policy easy
* Interactive graphic tracking global spread of coronavirus:
https://tmsnrt.rs/3mvcUoa

(Updates prices, adds quotes and graphic)
By Nakul Iyer
Feb 18 (Reuters) - Gold bounced off a 2-1/2-month low as the
U.S. dollar and Treasury yields eased on Thursday, though
analysts said optimism over economic recovery left bullion
vulnerable to further corrections.
Spot gold XAU= rose 0.7% to $1,788.16 an ounce by 1308
GMT, having touched its lowest since Nov. 30 at $1,768.60 on
Wednesday. U.S. gold futures GCv1 advanced 0.6% to $1,783.20.
"The dollar's slight declines have offered some respite for
gold, said FXTM market analyst Han Tan. "It's only natural that
gold would take a breather, after posting five consecutive days
of losses."
The dollar retreated, bolstering gold's appeal to other
currency holders.
Benchmark 10-year Treasury yields US10YT=RR pulled back
after hitting their highest since the end of February 2020 on
Wednesday, reducing the opportunity cost of holding non-yielding
bullion. US/
Also supporting gold, the U.S. Federal Reserve on Wednesday
reiterated its pledge to keep interest rates near zero until
inflation and employment pick up. However, gold is having a tough time trying to win over
investors as an inflation hedge, with other assets favoured
instead, FXTM's Tan said.
Optimism over an economic recovery was bolstered by strong
U.S. retail sales data on Wednesday.
On the technical front, a dip in gold's 50-day moving
average below the 200-day moving average could lead to more
selling, analysts said.
"Previously people would snap up gold as an inflation hedge,
(but) we are now seeing people pour money into Bitcoin," said
David Madden, analyst at CMC Markets UK, noting that Bitcoin's
rally could have contributed to gold's recent declines.
BTC=BTSP
Autocatalyst metal platinum XPT= also advanced 1.5% to
$1,271.94 an ounce.
"As long as data such as auto sales and production continues
to be positive, that will help the message that platinum should
be one of the winners from the industrial cycle strengthening,"
said independent analyst Robin Bhar.
Elsewhere, palladium XPD= rose 0.4% to $2,380.53 and
silver XAG= lost 0.2% to $27.29.

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