SINGAPORE, March 30 Gold held on to sharp
overnight gains on Wednesday, buoyed by a softer dollar and
Federal Reserve chair Janet Yellen's remarks that the U.S.
central bank should be cautious in raising interest rates.
        
    FUNDAMENTALS
    * Spot gold was little changed at $1,241.94 an ounce
by 0025 GMT, after gaining 1.7 percent on Tuesday.
    * Yellen said on Tuesday that the Fed should proceed only
cautiously as it looks to raise interest rates, pushing back on
a handful of her colleagues who have suggested another move may
be just around the corner.
    * In her first comments since the Fed decided to hold rates
steady two weeks ago, Yellen said inflation has not yet proven
durable against the backdrop of looming global risks to the U.S
economy, including still-low oil prices and concerns over
China. 
    * The U.S. dollar dropped sharply and stocks on Wall Street
ended at 2016 highs after Yellen's remarks.
    * Gold is highly sensitive to U.S. monetary policy, as
rising interest rates lift the opportunity cost of holding
non-yielding bullion, while boosting the dollar. The metal slid
3 percent last week after hawkish comments from a series of Fed
officials.
    * Dallas Federal Reserve President Robert Kaplan also echoed
Yellen on Tuesday, saying the central bank should proceed
gradually and cautiously in raising rates. 
    * San Francisco Fed President John Williams, a close ally of
Yellen who is usually among the core of decision-makers, said on
Tuesday that the U.S. central bank should stay on track with its
tightening plan. 
    * U.S. federal funds futures rose on Tuesday, implying
traders now think the Fed will not raise interest rates until
late 2016. 
    * Assets in SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, fell 0.40 percent to 820.47 tonnes on
Tuesday - the first drop in two weeks. 
    * Holdings are still near their highest in over two years as
wider turmoil in the stock markets has burnished gold's
safe-haven appeal.
    * China's net gold imports via main conduit Hong Kong rose
in February, from a 17-month low hit in the previous month,
buoyed by restocking after Lunar New Year and strong investment
demand.    
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    DATA AHEAD (GMT)
    0900 Euro zone Business climate Mar 
    1200 Germany Consumer prices Mar 
    1215 U.S. ADP national employment Mar 
    1700 Federal Reserve Bank of Chicago President Charles Evans
speaks on current economic conditions and monetary policy

    PRICES AT 0025 GMT
 Metal            Last      Change  Pct chg
                                           
 Spot gold         1241.94    0.14     0.01
 Spot silver        15.385   0.041     0.27
 Spot platinum       965.5   -1.67    -0.17
 Spot palladium        576     2.5     0.44
 Comex gold         1242.6     6.8     0.55
 Comex silver        15.39   0.157     1.03
                                           
 COMEX gold and silver contracts show the
 most active months
 
 (Reporting by A. Ananthalakshmi; Editing by Joseph Radford)