PRECIOUS-Gold, silver slide as dollar climbs to 2-month peak

* Biggest risk to gold is stronger recovery on vaccines-
analyst
* 10-year Treasury yields at over three-week high
* Bank of England policy decision due at 1200 GMT

(Updates prices)
By Sumita Layek
Feb 4 (Reuters) - Gold and silver prices dropped on
Thursday, as a firmer dollar dented their appeal, while
investors awaited the passage of a massive stimulus package in
the United States and the Bank of England's policy outlook.
Spot gold XAU= dropped 0.6% to $1,822.41 per ounce by 0823
GMT. U.S. gold futures GCv1 fell 0.5% to $1,825.20.
Silver XAG= declined 1.4% to $26.49. Prices have eased
since hitting a near eight-year peak of $30.03 on Monday as the
social media-driven rally fizzled out. "The moves in silver have been largely speculation and it's
becoming apparent that does not have a lasting effect," said
Michael McCarthy, chief market strategist at CMC Markets.
The dollar .DXY at a two-month peak was weighing on
precious metals, McCarthy said, adding "central bank watch is
key now ... any hint around tapering could impact gold and
silver." USD/
The Bank of England policy decision is due at 1200 GMT.
The recent speculative move in silver has worn off since
prices could not break above $30, although a spurt in demand
from the industrial sector can boost prices again, said Hareesh
V, head of commodity research at Geojit Financial Services.
Australia's Perth Mint posted a 23.5% jump in January silver
coin sales.
Further weighing on gold was benchmark 10-year Treasury
yields at over a three-week peak and a surge in crypto
currencies. US/ Investors' focus also remained on a $1.9 trillion U.S.
coronavirus aid plan, which was passed by the U.S. House without
Republican support. "The biggest risk to gold is stronger recovery as vaccines
rollout, to the extent that we see U.S. bond yields rally," said
Lachlan Shaw, National Australia Bank's head of commodity
research.
But "if the vaccine rollout faces uncertainty, with these
new emerging strains, then prices can still remain supported."
Platinum XPT= fell 1.5% to $1,084.27 an ounce and
palladium XPD= lost 0.8% to $2,255.31.