Gold gains in tug-of-war between lower yields and firm dollar

Gold gained on Thursday as lower U.S. Treasury yields boosted the appeal of the non-yielding metal and eclipsed pressure from a strengthening dollar.

Spot gold rose 0.3% to $1,739.60 per ounce. U.S. gold futures were up 0.3% at $1,739.30 per ounce.

U.S. benchmark Treasury yields continued their dip, translating into lower opportunity cost of holding bullion, after scaling one-year highs last week . “I don’t think it (gold) has much more downside and traders are looking for a bottom on the fact that short-term yields and the rise in the dollar are not sustainable,” said Bob Haberkorn, senior market strategist, RJO Futures.

The dollar hit a four-month high versus rivals.