Feb 26 (Reuters) - Gold prices climbed on Monday buoyed by a weaker dollar as U.S. bond yields dipped, while investors were
cautious ahead of Federal Reserve Chairman Jerome Powell's first congressional testimony. Powell will testify on the central bank's semi-annual report
on monetary policy and the economy on Tuesday, before the U.S. House of Representatives' Financial Services Committee. Spot gold        was up 0.8 percent at $1,338.97 an ounce by
0805 GMT after rising to as high as $1,340.85, the highest in about a week. Prices last week fell 1.4 percent, their biggest drop in 2-1/2 months.
U.S. gold futures were up 0.9 percent at $1,341.9per ounce. The dollar index, which measures the greenback against a basket of major currencies, was down 0.3 percent at
89.600. It had gained nearly 0.9 percent last week and pulled away from a three-year low of 88.253 set on Feb. 16. "Global growth appetite is okay. So it's not safe-haven
demand per se, but more of a currency influence," said OCBC analyst Barnabas Gan. The U.S. Federal Reserve, looking past a recent stock market
sell-off and concern about inflation, on Friday said it sees steady growth continuing and no serious risks on the horizon that might pause its planned pace of rate hikes.             
"But with the U.S.'s runaway deficit spending train stoking inflationary fears, gold remains a crucial 'buy on dip' strategy
not only to hedge against inflation but also against another untimely correction in equity markets," Stephen Innes, APAC trading head at OANDA, said in a note.
While inflation worries could spur safe-haven gold buying, rising interest rates would pressure the metal because bullion
pays no interest. A bullish target at $1,354 per ounce for spot gold has been adjusted to $1,347, based on its current momentum, according to
Reuters technical analyst Wang Tao. Meanwhile, Asian share markets were in a cautious mood on Monday as investors braced for an event-packed week headlined by
U.S. inflation data and the first House testimony by the new head of the Federal Reserve, Jerome Powell. Among other precious metals, silver        was up 1.1
percent at $16.72 an ounce. Palladium was up 0.8 percent at $1,054.72 per ounce after touching $1,058.40 earlier in the session, its highest
since Jan. 31. Platinum rose 0.7 percent to $1,003.50 per ounce.
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