* Renewed growth in gold ETFs have supported recovery-analyst * Dollar hits fresh one-month low By Seher Dareen May 24 (Reuters) - Gold prices rose to their highest level in two weeks on Tuesday, as the safe-haven metal's appeal was lifted by a weaker U.S. dollar and lower Treasury yields amid subdued risk appetite in financial markets. Spot gold rose 0.6% to $1,865.07 per ounce by 2:19 p.m. ET (1819 GMT), after hitting its highest since May 9 at $1,868.69 earlier in the session. U.S. gold futures settled up nearly 1% at $1,865.4. Weakness in the dollar index along with a fall in U.S. Treasury yields from their recent highs has provided a supportive environment for gold, said David Meger, director of metals trading at High Ridge Futures. The greenback hit a one-month low, while U.S. 10-year Treasury yields edged lower as weakness in equities revived safe-haven demand for the debt. "Gold traders are increasingly questioning the Fed's willingness to hike into a recession, as growing economic concern is breathing life into the gold market. Upside flow from CTAs along with renewed growth in ETFs have supported the recovery," analysts at TD Securities wrote in a note. The yellow metal is seen as a safe store of value during times of economic crisis and a hedge against inflation, but rising interest rates tend to weigh on non-yielding bullion. With the Federal Reserve amping up its fight against 40-year high inflation, Atlanta Fed President Raphael Bostic said in an essay on the bank's website that he urged caution so as to avoid triggering "significant economic dislocation" with interest-rate hikes that were too sharp. "Now that we know what we're getting out of the Fed, you could argue that gold once again has a fairly clear path moving forward," Meger added, highlighting the market still questions whether the rate hikes would be enough to stave off inflationary pressures in the short term. Spot silver rose 1.3% to $22.05 per ounce, platinum fell 0.6% to $952.80 and palladium rose 0.5% to $2,002.19. (Reporting by Seher Dareen in Bengaluru; Editing by Krishna Chandra Eluri, Shailesh Kuber and Amy Caren Daniel)
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Stocks mentioned in the article
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4.174 % | +0.005 | -0.112 | - | ||
1,500 PTS | +0.54% | -2.89% | - | ||
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