Dec 21 (Reuters) - Gold prices edged higher on Thursday, helped by a softer dollar and lower Treasury yields as traders looked forward to November U.S. inflation data due out on Friday for more clues on the Federal Reserve's monetary policy outlook.
FUNDAMENTALS
* Spot gold was up 0.2% at $2,033.92 per ounce, as of 0106 GMT. U.S. gold futures inched lower to $2,045.70.
* Benchmark U.S. 10-year bond yields fell to an almost five-month month low on Wednesday after British inflation plunged in November to its lowest rate in over two years.
* The dollar was down 0.1% against its rivals, making gold less expensive for other currency holders.
* A dovish tilt from the Fed in their last policy meeting has prompted traders to pencil in several rate cuts in 2024, starting as early as March.
* However, Fed officials have since been pushing back against the idea of rapid rate cuts next year.
* Philadelphia Fed President Patrick Harker said he still opposes any further central bank rate hikes, while signalling openness to lowering short-term borrowing costs, albeit not imminently.
* Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
* All eyes are now on the November core personal consumption expenditure (PCE) index report, the Fed's preferred measure of underlying inflation.
* Data on Wednesday showed U.S. existing home sales rose unexpectedly in November. U.S. consumer confidence increased more than expected in December amid optimism about the labour market.
* SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.07% to 878.25 tonnes on Wednesday.
* Spot silver rose 0.4% to $24.20 per ounce, while platinum gained 0.2% to $960.52 and palladium climbed 0.7% to $1,204.15.
DATA/EVENTS (GMT) 0745 France Business Climate Mfg, Overall Dec 1330 US GDP Final Q3 1330 US Initial Jobless Clm Weekly 1330 US Philly Fed Business Indx Dec (Reporting by Brijesh Patel in Bengaluru; Editing by Subhranshu Sahu)
