• Central banks' net gold buying down 56% m/m in May
• Subdued physical demand in major markets shows signs of recovery
• Platinum group metals rise as focus on EVs weakens
• U.S. non-farm payrolls due on Friday

LONDON, July 2 (Reuters) - Gold prices fell on Tuesday under pressure from elevated U.S. Treasury yields and a stronger dollar while investors awaited comments from Federal Reserve Chair Jerome Powell and more data for further clues about the interest rate path.

Spot gold was down 0.3% at $2,325.16 per ounce by 1105 GMT.

The benchmark 10-year Treasury yield hit a one-month high on Monday and stayed elevated on Tuesday, making non-yielding bullion less attractive, amid bets on the possibility of a second Donald Trump presidency.

"Markets are waiting for the nonfarm payrolls report at the end of the week," said StoneX analyst Rhona O'Connell. "Trump Supreme Court verdict may be supportive (for gold) for geopolitical reasons. Dollar and bond yields are already reflecting that postulation."

Gold is down 5% from a record high of $2,449.89 per ounce it touched on May 20, a rally caused by safe-haven demand driven by geopolitical and economic uncertainty as well as persistent central bank buying, a crucial category of demand.

"Physical demand is still subdued in major markets like India and Turkey but there are signs of recovery there as consumers are keen to protect against other factors like local inflation which still remains high," said a trader.

There are, however, signs that central banks are slowing down gold purchases amid high prices, though their demand remains above the pre-2022 level.

Central banks reported about 10 metric tons of net gold buying in May, 56% lower month-on-month, according to the World Gold Council. Central banks of Poland, Turkey and India were the largest buyers, while Kazakhstan sold 11 tons.

Saxo Bank expects gold and silver to hit $2,500 and $35 per ounce, respectively, by the end of 2024 as U.S. rate cuts could invite back demand for physically-backed gold exchange-traded funds.

Spot silver fell 0.4% to $29.33.

Platinum added 1.1% to $988.40 and palladium rose 1.9% to $989.75 with the focus on improved prospects for hybrid car sales vs slower growth of palladium-free electric vehicles market.

Sign up here.

https://www.reuters.com/markets/commodities/gold-flat-investors-eye-powells-speech-2024-07-02/