* Dollar eases off more than one-year high<\/p>\n
* Focus on U.S. Fed minutes due at 1800 GMT<\/p>\n
* Banks prepare to scrap LME gold and silver contracts (Adds comment, graphic, updates prices)<\/p>\n
Oct 13 (Reuters) – Gold prices rose 2% on Wednesday as the dollar and U.S. Treasury yields retreated, with investors\u2019 focus on minutes from the Federal Reserve\u2019s latest policy meeting for confirmation of its tapering strategy.<\/p>\n
Spot gold was up 1.9% at a near four-week high of $1,793.86 per ounce by 12:09 p.m. EDT (1609 GMT). U.S. gold futures jumped 2.1% to $1,795.60.<\/p>\n
Other precious metals followed along, with spot silver rising 2.7% to $23.15 per ounce, platinum gaining 1.2% to $1,018.96 and palladium adding 3.4% to $2,114.71.<\/p>\n
\u201cGold is just following yields at the moment. The initial reaction after CPI (consumer price index) data was a big spike in yields, which is now starting to fade away,\u201d said Daniel Pavilonis, senior market strategist at RJO Futures.<\/p>\n
Gold initially pared gains as benchmark U.S. 10-year Treasury yields rose above 1.6% following data showing U.S. consumer prices increased solidly in September and were poised for a further rise in coming months.<\/p>\n
But a subsequent pullback in yields, which reduced the opportunity cost of holding non-interest bearing gold, drove a strong rally in precious metals.<\/p>\n
The metal also drew support from a slide in the dollar and worries that high inflation would hit global economic growth.<\/p>\n
\u201cInflation expectations mixed with global growth concerns have made many investors nervous that the business and the consumer will be much weaker in the second half of 2022. Safe-haven flows are starting to come gold\u2019s way,\u201d Edward Moya, senior market analyst at brokerage OANDA, said in a note.<\/p>\n
Investors now await the release of minutes from the U.S. central bank\u2019s September meeting at 1800 GMT, amid expectations for tapering of economic support as soon as next month.<\/p>\n
Meanwhile, a group of banks that partnered with the London Metal Exchange to launch gold and silver futures in 2017 is preparing to abandon the project after hoped-for volumes did not materialise.<\/p>\n