* Biden a plan that will deliver “trillions” of dollars
* 10-year yield yield Finance close to 10-month highs
* Interactive graphical administration of global coronavirus distribution: tmsnrt.rs/3mvcUoa (New all over, add comments, price updates)
Jan 12 (Reuters) – Tuesday’s gold boomed in a choppy trade that has previously seen it climb as much as 1%, as a firm dollar and a rise in U.S. Treasury yields surpass support from inflation bets higher as Washington issued more stimulus.
Spot gold was 0.1% lower at $ 1,842.21 per ounce at 10:07 am EST (1507 GMT). On Monday, prices hit their lowest level since Dec. 2. U.S. gold futures were down 0.5% at $ 1,841.80.
“We still have COVID-19 rising and resisting the spread of the vaccine and looking out, in the spring the worst may be over,” said a senior. Kitco Metals analyst Jim Wyckoff, adds a further reversal in the dollar index and rising yields remain negative for gold.
The dollar index rebounded from a nearly three-year low reached last week, when U.S. 10-year benchmark yields broke 1% for the first time since March.
Gold is generally regarded as a hedge against inflation and currency damage that can result from widespread stimulus. However, higher bond yields have recently challenged that status as they increase the opportunity cost of maintaining non-yielding bullion.
“There will be a major stimulus package that should support the gold market, not only stimulate demand but also stimulate ideas about some difficult price inflation,” Wyckoff said.
US President Joe Biden said Americans needed more economic relief from the COVID-19 pandemic and would deliver a plan that would cost “trillions” of dollars.
While gold remained vulnerable in the short term for dollar gains and yields, “the macro picture remains positive for gold,” said Nicholas Frappell, global general manager at ABC Bullion.
Silver gained 1.6% to $ 25.31 an ounce. Platinum climbed 3% to $ 1,063.17, while palladium was up 0.9% at $ 2,393.52. (Reporting by Shreyansi Singh and Sumita Layek in Bengaluru; Editing by Kirsten Donovan)