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Gold hits record peak at $2141.59 per ounce on Tuesday

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Analyst says gold rally sentimental, could see profit

taking

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Focus on Powell's first day of congressional testimony

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Cenbank gold buys more than offsets waning ETF demand -

analyst

(Rewrites throughout, adds comments and more details in

paragraph 1, 4-5, 7, 9)

By Harshit Verma

March 6 (Reuters) - Gold prices held above the $2,100

level on Wednesday, near a record peak hit in the previous

session as hopes for U.S. rates easing by mid-year mount, while

traders awaited remarks on the economy's health from Federal

Reserve Chair Jerome Powell.

Spot gold edged down 0.1% at $2,126.13 per ounce, as

of 0458 GMT. U.S. gold futures fell 0.4% to $2,134.30.

Spot prices hit a record peak of $2141.59 per ounce

overnight on Tuesday, rallying for a fifth straight session.

Gold's rally is sentiment driven, which was triggered by

last week's poor U.S. economic data that gave little more

clarity for a June rate cut, said Ajay Kedia, director at Kedia

Commodities, Mumbai, adding, without other factors at play, such

as dollar's movement, or any surge in geopolitical tensions,

gold could see profit taking.

Traders are weighing in risks to the U.S. economic health in

a high-interest rate environment and would be tuning into

Powell's first day of semi-annual congressional testimony for

more clarity on the same.

U.S. services industry growth slowed a bit in February amid

a decline in employment and new orders for U.S.-manufactured

goods dropped more than expected in January.

Data on the U.S. labour market due this week will also be

closely watched for. Any downside surprise could help support

gold.

Traders see a 71% chance for a June Fed rate cut. Lower

rates boost the appeal of non-yielding bullion.

"The central banks are buying more than 1,000 tons of gold

consecutively from last two years versus the historic average of

300 (tons). This has made-up for all the loss in the retail and

ETF demand," said Kunal Shah, head of research, Nirmal Bang

Commodities, Mumbai.

Spot platinum rose 0.4% to $884.16 per ounce, and

palladium rose over 1% to $958.20, while silver

dropped 0.3% to $23.63.