NEW YORK: Gold prices rose on Tuesday, drawing support from a weaker US dollar even as higher bond yields and easing worries about a full-blown banking crisis limited gains for the safe-haven asset.

Following two sessions of declines, spot gold gained 0.7% to $1,970.88 per ounce by 1:40 p.m. EDT (1740 GMT). US gold futures settled 1% higher at $1,973.50.

The US dollar index retreated about 0.4%, making the greenback-denominated precious metal less expensive for holders of other currencies.

“The weaker US dollar index today is adding to some buying interest in the gold market. However, solid buying interest is being squelched by the fact that the banking crisis, at least for the moment, seems to have stabilized,” said Jim Wyckoff, senior analyst at Kitco Metals.

In the first congressional hearing into the sudden collapse of two US regional lenders and the ensuing chaos in markets, a top US regulator criticized Silicon Valley Bank over its risk management, as lawmakers demanded to know why warning signs of trouble were missed.

“The marketplace is still tentative in that regard, and that’s going to keep risk appetite contained for at least the next couple weeks until we think we’ve moved past this crisis,” added Wyckoff.

Wall Street struggled for direction as investors weighed receding concerns about a banking crisis, while Treasury yields rose amid focus on Federal Reserve’s interest rate trajectory.