Feb 27 (Reuters) - Gold prices inched up on Tuesday, buoyed by a weaker U.S. dollar and bond yields, ahead of a key inflation report and comments from Federal Reserve officials for further clues on when interest rate cuts will commence.
Spot gold was up 0.4% at $2,038.15 per ounce as of 1229 GMT, hovering near its highest since Feb. 7 hit on Friday. U.S. gold futures rose 0.4% to $2,047.30 per ounce.
The dollar index (.DXY), opens new tab extended its losing run, and benchmark 10-year Treasury yield fell, making greenback-priced bullion more appealing for other currency holders.
"It is a modest uptick in gold, likely driven by slightly lower U.S. long-term interest rates and a moderately weaker dollar. Solid physical demand and central bank purchases are keeping gold above the $2,000 per ounce," said UBS analyst Giovanni Staunovo.
"We continue to expect the Fed to cut rates around mid-year, that will likely support demand from financial investors and lift the gold price to $2,250 per ounce by the end of this year."
Recent remarks from Fed policymakers suggested the U.S. central bank was in no rush to cut interest rates, largely cementing bets against any rate cuts before June.
Markets are currently pricing in a 63% chance of a Fed rate cut in June, according to the CME FedWatch Tool, opens new tab.
Lower interest rates boost the appeal of holding non-yielding bullion.
At least 10 Fed officials are due to speak this week, while investors are focussed on the core personal consumption expenditures price index, the Fed's preferred inflation gauge, due on Thursday.
The video player is currently playing an ad. You can skip the ad in 5 sec with a mouse or keyboard
China's net gold imports via Hong Kong jumped about 51% in January from the previous month, data showed.
Spot platinum climbed 1.7% to $895.10 per ounce, palladium rose 1.1% to $960.88, and silver edged 0.8% higher to $22.70 per ounce.
Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Varun H K and Tasim Zahid