Gold Price Analysis: XAG/USD clings near $1,740 mark amid firmer US dollar

• Gold maintained its dovish stance as the US dollar remained strong.
• However, the pullback in US Treasury yields offered support to the price.
• Weaker equities also helped in the price recovery from lower levels.

Gold started the new trading week on a subdued note and traded with mild losses in the early European session. The strength in the US dollar continued to squeeze the price for the precious metal near the $1,750-45 region.

At the time of writing, gold is trading at $1,741.60, down 0.18% on the day.

Yield on the US 10-year notes retreated from 1.67% to 1.65% after FED Chair Jerome Powell downplayed inflation and reaffirmed that the central bank would maintain its accommodative monetary stance. This, in turn, sent the benchmark yield  into a corrective mode, thus boosting the demand for gold as an inflation-hedged instrument.

Gold attracted investors amid a slump in prices, which drove the demand. India reported a surge in gold imports in March to the highest level in almost two years as falling prices boosted the demand for jewelry during the ongoing wedding season.

Investors remained reclusive to equities as the rising number of coronavirus cases raised doubts over the economic recovery across regions. Gold gains at the expense of the riskier asset.

On the other hand, the upbeat US economic outlook continued to benefit the greenback, which kept gold’s upside momentum in check.