* Dollar near one-month high hit in previous session
* Markets await unveiling of U.S. tax plan
(Adds analyst comments, updates prices) Sept 27 (Reuters) - Gold was largely unchanged on Wednesday after falling over one percent in the previous session on hawkish comments from U.S. Federal Reserve Chair Janet Yellen, while lingering North Korea worries supported prices.
Spot gold inched 0.1 percent higher to $1,294.89 per
ounce at 0425 GMT. In the previous session, prices fell 1.3 percent in what was the biggest loss in over two weeks.
U.S. gold futures for December delivery fell 0.3
percent to $1,297.80 per ounce. "Gold lost what it gained on North Korea (tensions) since Friday after Yellen's comments, said Yuichi Ikemizu, Tokyo branch manager at ICBC Standard Bank. "But I think the (North Korea) situation is more serious than the Fed's policies. So, gold is supported around here and I expect prices to go back up to $1,300 an ounce." On Tuesday, Yellen said the Fed needs to continue gradual rate hikes despite broad uncertainty about the path of inflation - remarks that acknowledged the central bank's struggles to forecast one of its key policy objectives. Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the greenback. A strong U.S. inflation reading could raise expectations for future interest rate increases. President Donald Trump warned North Korea on Tuesday that any U.S. military option would be "devastating" for Pyongyang, but said the use of force was not Washington's first option to deal with the country's ballistic and nuclear weapons program.
"The wild card, as usual, is the North Korea situation, something that is very hard to quantify at this stage," INTL FCStone analyst Edward Meir said in a note Geopolitical risks can boost demand for safe haven assets such as gold. The dollar climbed to a one-month high and bond yields rose as risks grew for a U.S. interest rate hike in December, while Asian stocks hovered near multi-week lows as tensions in the Korean peninsula remain elevated. The biggest focus for the market for Wednesday is the announcement of a tax plan by the U.S. administration and Republicans in Congress.
Among other precious metals, silver rose 0.3 percent
to $16.82 per ounce. In the previous session, prices fell 2.4 percent, their biggest fall since mid-August
Platinum gained 0.2 percent to $923.50 per ounce,
after slipping about 2 percent in the previous session, its biggest decline since early July.
Meanwhile, palladium fell 0.1 percent to $913.40 per
(Reporting by Nithin Prasad and Arpan Varghese in Bengaluru; Editing by Vyas Mohan)