SINGAPORE: Gold prices were down on Thursday on a strong dollar after Federal Reserve Chair Janet Yellen advocated lifting US interest rates gradually.

Spot gold was down 0.1 percent to $1,202 per ounce by 0600 GMT, after dropping to as much as $1,197.31. The bullion hit an eight-week high of $1,218.64 on Tuesday.

US gold futures fell as much as over 1 percent to $1,197.10.

The dollar index, which measures the greenback against a basket of currencies, rose 0.3 percent to 101.230.

With the US economy close to full employment and inflation headed toward the Federal Reserve's 2 percent goal, it "makes sense" for the US central bank to gradually lift interest rates, Fed Chair Janet Yellen said on Wednesday.

"(Yellen's) speech was interpreted as being bearish for gold," said INTL FCStone analyst Edward Meir, adding that the metal could be under more pressure later in the day as the Fed chair speaks on US monetary policy again on Thursday.-Reuters

Gold slips in NY

NEW YORK: Gold retreated on Wednesday from the previous day's eight-week high as data showing the biggest pick-up in US consumer prices in 2-1/2 years lifted the dollar and US Treasury yields.

Moves were muted however as the markets awaited a speech by Federal Reserve chair Janet Yellen later in the session, which will be closely watched for clues on US monetary policy.

Spot gold was down 0.6 percent at $1,209.34 an ounce by 2:45 p.m. EST (1945 GMT), after hitting its highest since mid-November on Tuesday.

US gold futures for February delivery settled down 0.07 percent at $1,212.10.

The US Labour Department said on Wednesday its Consumer Price Index rose 0.3 percent last month and 2.1 percent in the 12 months through December, the biggest year-on-year gain since June 2014.

"We expect a lot more aggressive rate hikes from the Fed in response to already rising inflationary pressures," Capital Economics analyst Simona Gambarini said.

"Possibly there will be even stronger inflation due to Trump's policies - it very much depends on what gets implemented at a fiscal level."

Silver turned down 0.1 percent to $17.14 an ounce, after rising to a two-month high at $17.33.

Platinum was 1.3 percent lower at $961.49 and palladium was up 0.2 percent at $749.30.-Reuters