By Ashitha Shivaprasad
March 14 (Reuters) – Gold prices fell on Tuesday, halting a strong rally fueled by the U.S. banking crisis, as the dollar rebounded as traders positioned themselves for inflation data that could also weigh on the Federal Reserve’s interest rate strategy.
* Spot gold was down 0.5% at $1,903.20 an ounce at 0924 GMT. US gold futures also fell 0.5% to $1,906.90.
* Gold prices rose more than 2% in the previous two sessions as investors sought cover after the failure of Silicon Valley Bank (SVB) spooked the market.
* The dollar index rose 0.4%, making bullion prices – which are quoted in dollars – less attractive to buyers of other currencies.
* Seen as a hedge against economic uncertainties, unremunerated gold becomes a more attractive bet in a low interest rate environment.
* Fitch Ratings, ANZ and Citi are among market participants who raised their gold price outlook this week as the SVB saga unfolded.
* Traders now see a 31.4% chance that the Federal Reserve will keep rates within the current range.
* Attention now turns to the US Consumer Price Index (CPI), due out at 12:30 GMT. According to a Reuters poll, consumer prices likely rose at a healthy pace in February.
* Among other precious metals, spot silver was down 0.8% at $21.64 an ounce, platinum was down 0.8% at $987.95, after hitting a high of over month in the last session, and palladium was down 0.9% at $1,460.38.
(Reporting by Ashitha Shivaprasad in Bengaluru; Editing in Spanish by Ricardo Figueroa)