By Arundhati Sarkar
(Reuters) - Gold slipped to a two-week low on Wednesday as strength in the dollar and higher U.S. Treasury yields outweighed the boost to bullion from deepening concerns about global economic growth.
Spot gold was down 0.1% at $1,792.27 per ounce by 1:49 pm EDT (1749 GMT), having dropped to $1,781.30, its lowest since Aug. 26. U.S. gold futures settled down 0.3% at $1,793.5.
"It's frustrating to gold market bulls that even though there's some keener risk aversion in the marketplace this week, the gold market sold off," said Jim Wyckoff, senior analyst at Kitco Metals.
Worries about a Delta variant-driven slowdown in economic growth have shaken equities this week, but flows into gold have been limited by firmer bond yields and a rise in the dollar that has made bullion costlier for holders of other currencies. [.N] [MKTS/GLOB] [USD/][US/]
"Gold's limited gains in 2021 despite low rates and high inflation prints does not bode well for its prospects and we see gold prices to average $1,750 on average in 2022 as investment flows drop further," Societe Generale said in a note.
New York Fed Bank President John Williams on Wednesday said that it may be appropriate for the Federal Reserve to start reducing the pace of its asset purchases later this year if the U.S. economy continues to improve.
Investors also eye a European Central Bank meeting on Thursday for hints on whether it may roll back economic support.
Non-yielding gold tends to gain in a low interest-rate environment, while some investors also view the metal as a hedge against higher inflation that could follow stimulus measures.
Elsewhere, silver fell 1.2% to $24.02 per ounce, platinum dropped 1.7% to $981.77 and palladium shed 4.8% to $2,259.23.
(Reporting by Arundhati Sarkar in Bengaluru; additional reporting by Swati Verma; Editing by Aditya Soni and Shailesh Kuber)