PRECIOUS-Gold rises as dollar, Treasury yields fall; US data awaited

By Anjana Anil

March 11 (Reuters) - Gold rose on Tuesday on weak dollar and Treasury yields, as investors awaited inflation data to assess the Federal Reserve's policy path amid simmering trade tensions and fears of economic slowdown.

Spot gold XAU= rose 0.4% to $2,901.13 an ounce as of 0701 GMT, while U.S. gold futures GCcv1 firmed 0.2% to $2,905.70.

The dollar index .DXY hovered near a four-month low hit last week, making bullion less expensive for overseas buyers, while benchmark 10-year U.S. Treasury yields US10YT=RR fell. US/USD/

"U.S. dollar and Treasury yields are lower, which is helping gold catch a bit of support... The overall uptrend remains intact and the path of least resistance favours the upside," said Ilya Spivak, head of global macro at Tastylive.

"Prices have been stable in a range between about 2,830 and 2,960 for the past four weeks... We would need to see a convincing break above or below these boundaries to conclude that some sort of lasting directional move is resuming."

U.S. President Donald Trump, in a Fox News interview on Sunday, declined to predict whether his tariffs would result in a U.S. recession, sending global stocks down. MKTS/GLOB

Trump imposed 25% tariffs on imports from Mexico and Canada last Tuesday, along with fresh duties on Chinese goods, but later exempted many Mexican and Canadian imports from those tariffs for a month, creating uncertainty in the markets and fanning worries of U.S. inflation and growth slowdown.

Investors now await U.S. Consumer Price Index (CPI) data due on Wednesday to analyse the Fed's interest rate stance.

Gold is considered a hedge against political risks and inflation, but if rising prices force the Fed to keep rates higher, the non-yielding asset could lose it allure.

Spot silver XAG= added 0.3% to $32.21 an ounce, platinum XPT= fell to 0.1% $956.63 and palladium XPD= lost 0.1% to $942.10.