* U.S. dollar index edges down
* U.S. Federal Reserve to issue the Beige book at 1800 GMT
* U.S. CPI gains by the most in over 8-1/2 years in March
(New throughout, adds comments, updates prices)
By Shreyansi Singh
April 14 (Reuters) - Gold fell on Wednesday as an uptick in
U.S. Treasury yields weighed on bullion's appeal, while
investors awaited speeches by several Federal Reserve officials
in the wake of data showing higher inflation.
Spot gold fell 0.3% to $1,739.00 per ounce, as of
10:45 a.m. EDT (1445 GMT). U.S. gold futures were down
0.6% at $1,738.00.
The uptick in bond yields seem to be "adding some very
light pressure to the (gold) market," said David Meger, director
of metals trading at High Ridge Futures.
But gold's pullback looks more technical in nature with the
$1,750 level being both a technical and a psychological level of
resistance in the short term, Meger added.
Bullion jumped as much as 0.9% on Tuesday after U.S.
consumer prices rose by the most in more than 8-1/2 years in
March, kicking off what is expected to be a brief period of
higher inflation.
Benchmark Treasury yields recovered slightly, offsetting
support for gold from a lower U.S. dollar.
While bullion is considered a hedge against inflation,
higher yields challenge that status as they translate into
higher opportunity cost of holding bullion.
A tick up of inflation tied with the expectations of the
resurgence in demand in the United States is a recipe for higher
prices across the board, from equities to commodities, Meger
added.
However, gold was supported by comments from Philadelphia
Federal Reserve President Patrick Harker who said the Fed will
not withdraw its funding just yet even as the U.S. economy could
expand by 5% to 6% this year.
"It seems that over the near term there are not many new
triggers to substantially move gold prices either way, but the
inflation outlook remains the key determinant," said Xiao Fu,
head of commodities markets strategy at Bank of China
International.
Silver rose 0.3% to $25.41 per ounce and palladium
edged 0.2% lower to $2,684.30. Platinum gained
2.3% to $1,182.46.
(Reporting by Shreyansi Singh and Sumita Layek in Bengaluru
Editing by Alistair Bell)
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