KONTAN.CO.ID - SINGAPORE. Gold prices gained on Tuesday as a recent rally in the U.S. dollar and Treasury yields showed signs of fatigue ahead of crucial inflation and jobs data this week that could define the outlook for interest rates.

Spot gold climbed 0.2% to $1,923.27 per ounce by 0645 GMT, hovering close to its highest level since Aug. 10 reached on Monday. U.S. gold futures gained 0.2% to $1,951.10.

Gold prices are seeing short-covering by speculators as a minor key resistance at $1,907 that coincided with the 200-day moving average has been surpassed, said Kelvin Wong, a senior market analyst, Asia Pacific, OANDA.

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Helping gold further, the dollar dipped against a basket of major currencies, while benchmark U.S. 10-year Treasury yields moved further away from their highest levels since 2007 hit last week.

A weaker dollar tends to make gold, which yields no interest, less expensive for other currency holders.

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Fed Chair Jerome Powell's comments indicated the inflation fight is not over and hence the stagflation playbook scenario has started to creep back up again, where it may have started to attract a bit of demand for gold as an asset diversifier, said Wong.

Among the string of U.S. economic data scheduled to be released this week, focus would be on the Federal Reserve's preferred inflation measure - the PCE price index due on Thursday, and the non-farm payrolls report on Friday.

With elevated rates, consumer spending is likely to slow and a recession becomes almost inevitable, which would result in falling bond yields and a weaker dollar, and gold prices could rebound, Heraeus analysts wrote in a note.

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.3% on Monday.

Elsewhere, spot silver added 0.1% to $24.28 per ounce and platinum gained 0.1% to $965.49, having opened at its highest level in a month. Palladium lost 0.6% to $1,247.15. 

Editor: Wahyu T.Rahmawati