Nov 28 Reuters Gold steadied after touching a sixmonth peak on Tuesday, as expectations of an end to the U.S. Federal Reserve39;s interest rate hike cycle kept the dollar and bond yields under check.

Spot gold rose 0.1 to 2,015.33 per ounce by 0643 GMT, after hitting its highest since May 16.

U.S. gold futures for December delivery rose 0.2 to 2,015.70 per ounce.

Lower bond yields and bets the Fed may cut sooner than originally thought have certainly helped gold shine, City Index senior analyst Matt Simpson said.

The dollar index touched its lowest since late August against its rivals, making gold less expensive for other currency holders. Yields on 10year Treasury notes hovered near twomonth lows of 4.3630.

Recent data showing signs of slowing inflation in the U.S. has boosted expectations that the Fed could begin easing monetary conditions sooner than expected, with the market now awaiting Personal Consumption Expenditures PCE data Fed39;s preferred inflation gauge on Thursday.

It simply comes down to whether inflation continues to soften at a quick enough pace to justify bets of rate cuts. And my bet is that it wont, and that gold may find that bump in the road, Simpson said.

If so, Id look for evidence of support around 1,990 or 1,960 as there was a lot of trading activity in that area.

Traders widely expect the U.S. central bank to hold rates in December, while pricing in about a 5050 chance of easing in May next year, CME39;s FedWatch Tool shows….