(Adds comment and updates prices) * U.S. retail sales data due at 1330 GMT * Fed may not be hawkish enough - analyst Nov 16 (Reuters) - Gold prices gained on Tuesday, with worries over more persistent inflation keeping bullion’s appeal as a hedge against higher prices intact, despite a stronger U.S. dollar and elevated bond yields. Spot gold rose 0.2% to $1,865.81 per ounce by 0652 GMT. U.S. gold futures were up 0.1% to $1,868.40. Gold prices have rallied 1.7% since last Wednesday’s surge in U.S. consumer prices last month, even as the dollar hit a 16-month high and 10-year Treasury yields moved higher. A stronger dollar makes gold more expensive for buyers holding other currencies, while higher yields increase the metal’s opportunity cost. “Inflation has gotten so high that markets reason that the Fed will be more hawkish but still not hawkish enough, boosting the appeal of an inflation hedge like gold despite the higher dollar,” DailyFX currency strategist Ilya Spivak said. But the metal’s range-bound moves after Wednesday’s break-out could suggest a “knee jerk” reaction to elevated inflation that does not have lasting follow through, Spivak said. Investors now eye U.S. retail sales data due at 1330 GMT which follows last week’s weak consumer sentiment reading. “The Fed’s announcement for start of asset purchases has been dampened by signals of delay in rate hikes, favouring gold investment,” ANZ analysts said in a note. Richmond Federal Reserve President Thomas Barkin said on Monday that while the Fed will not hesitate to raise interest rates, the central bank should wait to gauge if inflation and labor shortages prove to be more long-lasting. Rate hikes tend to weigh on gold, as higher interest rates raise the non-yielding metal’s opportunity cost. “Physical demand is also encouraging, with China imports averaging 25 tonnes against less than 10 tonnes last year”, ANZ said. Elsewhere, spot silver rose 0.1% to $25.06 per ounce. Platinum fell 0.2% to $1,085.28 and palladium dropped 0.9% to $2,133.89. (Reporting by Nakul Iyer in Bengaluru; Editing by Sherry Jacob-Phillips, Rashmi Aich and Uttaresh.V)