March 1 (Reuters) - Gold prices fell to a three-week low on Thursday, weighed down by a stronger dollar, while investors
awaited the second session of Federal Reserve Chairman Jerome Powell's testimony before the Senate Banking Committee later in
the global day. Spot gold was 0.3 percent lower at $1,313.81 an ounce at 0744 GMT, after touching $1,312.26, the lowest since Feb.9.
Prices have fallen over 1 percent so far this week. U.S. gold futures were down 0.2 percent at $1,314.7 per ounce. The dollar index , which measures the greenback
against a basket of major currencies, was steady at 90.617. It had earlier touched its highest since Jan. 19 at 90.744. "U.S. dollar firmness continues to weigh on gold but (the
metal) found some support on weakness in equities," said a Hong Kong-based trader. The U.S. currency, which in February recorded its best
monthly performance since November 2016, has been bolstered by Powell's hawkish stance on the U.S. economy that fuelled expectations of interest rates being raised four times this year
rather than three. Higher interest rates tend to boost the dollar and push bond yields up, making greenback denominated, non-yielding gold more
expensive for holders of other currencies. The gold market is keenly waiting for the second round of Powell's testimony. "There's the chance he dials back his hawkish rhetoric, but
if he stays the course, there's always a chance we could see higher repricing of U.S. interest rates and a slightly firmer
dollar which could trigger another leg lower in gold prices," Stephen Innes, APAC trading head at OANDA, said in a note. U.S. economic growth slowed slightly more than initially
thought in the fourth quarter after the strongest pace of consumer spending in three years depleted inventories and drew in imports as businesses struggled to produce enough goods and
services. Meanwhile, Asian stocks fell on Thursday after the Fed chief's comments revived fears about the pace of U.S. monetary
tightening this year, amid concerns that higher borrowing rates could crimp corporate activity and cool economic growth.
Spot gold continues to target $1,303 as it has more or less broken a support at $1,317 per ounce, according to Reuters technical analyst Wang Tao.
The key psychological level of $1,300 could bring in thenext round of buying, said another trader in Hong Kong. "Gold needs a good day up for people to feel confident to
buy it. We're making it lower and lower everyday," said the trader. Among other precious metals, silver shed 0.3 percent to $16.35 an ounce.
Platinum fell 0.6 percent to $977.20 per ounce, while palladium was flat at $1,042.50 per ounce.
