PRECIOUS-Gold slides more than 2% as dollar rebounds, Treasury yields jump

(Updates prices)
* Democrats win one Georgia runoff, lead in second
* Silver, platinum fall more than 3%
* Palladium falls as much as 3%
* Dollar index recovers from 2-1/2-year low
* Fed's latest policy meeting minutes due at 1900 GMT

By Shreyansi Singh
Jan 6 (Reuters) - Gold tumbled more than 2% on Wednesday,
hit by a rebound in the dollar as U.S. Treasury yields surged,
with investors betting on a Democrat win in the U.S. Senate
runoff elections in Georgia.
Spot gold XAU= was down 2.1% at $1,907.75 per ounce at
1:46 p.m. EST (1846 GMT), having earlier hit a near two-month
peak at $1,959.01. U.S. gold futures GCv1 settled down 2.3% at
$1,908.60.
"Higher (bond) yields have boosted the dollar and triggered
a selloff in gold that accelerated with stops under $1,935-40,"
said Tai Wong, head of base and precious metals derivatives
trading at BMO.
"$1,900 is an important pivot that needs to hold to maintain
the short term bullish narrative."
The 10-year U.S. Treasury yield rose above 1% US10YT=RR
for the first time since March, increasing the opportunity cost
of holding non-interest bearing gold. US/
The dollar index firmed after a dive to 2-1/2-year lows,
making gold less attractive for those holding other currencies.
USD/
But BMO's Wong said this was a buying opportunity. "A
Democratic Congress with Biden in the White House is a license
to spend, and that's not a lower gold environment."
With investors expecting more fiscal stimulus as the
Democrats lead in runoff votes that will determine control of
the U.S. Senate, gold remains underpinned as an inflationary
hedge. David Meger, director of metals trading at High Ridge
Futures, said the pullback was a short-term move as a potential
"Blue Wave" in the U.S. Senate would be dollar negative and
"supportive to gold and silver from a longer term perspective".
Meanwhile, minutes of the U.S. Federal Reserve's Dec. 15-16
policy meeting are due at 1900 GMT.
Other metals followed gold's slide. Silver XAG= fell 2% to
$27.00 an ounce, while platinum XPT= dipped 0.9% to $1,102.04.
Both metals had fallen more than 3% earlier in the session.
Palladium XPD= was down 1.5% at $2,430.39, having earlier
declined as much as 3%.