PRECIOUS-Gold slips as dollar bounces on global trade jitters
* U.S. dollar hits near seven-week peak
* Platinum at three-week low
* Palladium drops from over three-week high (Adds fresh quotes, updates prices)
By Swati Verma
Feb 11 (Reuters) - Gold prices edged lower on Monday asinvestors preferred the safety of the dollar in the face ofmounting concerns over the U.S.-China trade dispute, and inturn, global growth.
Spot gold XAU= dropped 0.4 percent to $1,308.47 per ounceat 10:26 a.m. EST (1526 GMT) having risen for the previous twosessions. U.S. gold futures GCv1 declined 0.5 percent to$1,312 per ounce.
"The big factor here is the strengthening of the U.S.dollar," which is being supported by the trade dispute, saidBart Melek, head of commodity strategies at TD Securities inToronto.
"Any sort of a lack of agreement between the United Statesand China weakens the global emerging market currencies and thatmeans, in relative terms, the U.S. dollar does better, which isnegative for gold," he said.
Trade talks between Washington and Beijing are set to resumethis week with a delegation of U.S. officials traveling to Chinafor the next round of negotiations. urn:newsml:reuters.com:*:nL3N20614C
But U.S. President Donald Trump last week said he did notplan to meet with China's President Xi Jinping before the March1 deadline, dampening hopes that a trade pact might be reachedquickly.
The dollar index .DXY was at a near seven-week high,potentially denting demand for the metal amongst holders ofother currencies. FRX/
"Gains in U.S. and world stock markets are also a bearishelement for the safe-haven metals," Jim Wyckoff, senior analystat Kitco Metals, wrote in a note to clients. MKTS/GLOB
The precious metal could be vulnerable to more correctionsif the dollar strengthens further, analysts said.
"With U.S. employment numbers still quite strong and peoplemoving into dollar for safe haven purposes, there is really nogood reason why gold should take off much higher," TD's Meleksaid.
But the yellow metal held above the key $1,300-per-ouncelevel, supported by uncertainties surrounding the U.S. FederalReserve's monetary policy and another possible governmentshutdown looming in Washington, analysts said.
While gold is supported by the Fed's policy, prices willlikely remain rangebound until there is clarity on the tradefront and a government shutdown, OANDA analyst Edward Moya saidin a research note.
Among other precious metals, platinum XPT= fell 1.4percent to $786.50 per ounce, after touching its lowest in threeweeks at $783.35.
"The spot price of platinum breaking through the $800 levelhas forced some hedge funds to head for the exit," WalterPehowich, executive vice president of investment services atDillon Gage Metals, said in a note.
"With a lack of any good news to support a rally in thismarket, I expect the sell off to continue."
Palladium XPD= slid 1.3 percent to $1,383.95 after risingto its highest in since Jan. 18 at $1,404.50 earlier in thesession.
Silver XAG= dropped 0.6 percent to $15.73 an ounce.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ GRAPHIC-Gold vs U.S. dollar https://tmsnrt.rs/2UMR3Lk ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>(Reporting by Swati Verma and Arpan Varghese in Bengaluru;editing by G Crosse) ((Swati.Verma@thomsonreuters.com; +1-651-848-5832, outsideN.America, +91-80-6749-6356/1298; Reuters Messaging:firstname.lastname@example.org))
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