* Dollar at an almost two-week low
* Strong U.S. data lifts stocks to record highs
(Adds comments, background; updates prices)
By Diptendu Lahiri
April 6 (Reuters) - Gold prices rose on Tuesday to their
highest level in more than a week as a weaker dollar and
pullback in U.S. bond yields lifted demand for the safe-haven
metal.
Spot gold was up 0.4% at $1,734.72 per ounce by 0434
GMT after hitting its highest since March 26 at $1,735.30.
U.S. gold futures were also up 0.4% at $1,734.80 per
ounce.
"After the strong economic data on Friday and yesterday
(Monday) from the U.S., the dollar took a hit on its safe-haven
appeal and investors rushed to park their money in riskier
assets with more returns," said IG Market analyst Kyle Rodda.
The dollar slumped to an almost two-week low versus a
basket of rival currencies, making gold cheaper for buyers
outside the United States.
Benchmark U.S. Treasury yields slipped, moving further away
from a 14-month peak hit last week. Lower bond yields reduce the
opportunity cost of holding non-interest bearing gold.
Meanwhile, recent better-than-expected economic readings out
of the United States have lifted hopes around swift recovery and
drove investors towards riskier assets.
"Gold has formed a short-term double bottom but needs to
break above $1,750 before it can head higher," Stephen Innes,
chief global market strategist at financial services firm Axi
said in a note.
"The metal could struggle to extend last week's recovery
with the positive U.S. non farm payroll data underpinning
risk-on sentiment."
The U.S. economic outlook is brightening, Cleveland Federal
Reserve Bank President Loretta Mester said on Monday, adding
that the Federal Reserve should stick to its easy monetary
policy to help support growth further.
Gold tends to benefit from widespread stimulus measures from
central banks because it is widely viewed as a hedge against
inflation and currency debasement.
Elsewhere, silver was flat at $24.90 per ounce, while
palladium was down 0.4% at $2,654.33 per ounce. Platinum
inched down 0.1 %, to $1,207.50 per ounce.
(Reporting by Diptendu Lahiri in Bengaluru, Editing by Sherry
Jacob-Phillips and Shailesh Kuber)
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