PRECIOUS-Gold slips as strong dollar, bond rally offset boost from growth woes

* SPDR Gold holdings rise 0.5% on Wednesday
* Platinum falls to over 3-month lows

(Updates prices)
By Sethuraman N R
May 30 (Reuters) - Gold prices fell to one-week low on
Thursday as bonds rallied and the dollar hovered near a two-year
high, offsetting the support for bullion from an increasingly
bitter Sino-U.S. trade dispute that rekindled doubts about
global economic growth.
Spot gold XAU= was down 0.3% at $1,275.59 per ounce, as of
0715 GMT, after falling to its lowest since May 23 at $1,274.95.
U.S. gold futures GCv1 edged 0.5% lower to $1,274.70 an
ounce.
"Investors look like they prefer U.S. Treasuries as a safe
haven for now, evident by the inverted U.S yield curve," Howie
Lee, an economist at OCBC Bank, said.
"A strong dollar is also likely impeding big players such as
China and India from consuming too much (of gold)."
The dollar held steady against its key rivals on Thursday as
escalating Sino-U.S. trade tensions forced investors into the
shelter of safe-haven assets, including government bonds. USD/
Against a basket of six major currencies, the dollar was
steady at 98.222 .DXY , hovering within the reach of a two-year
high of 98.371 hit a week ago. The index is up more than 2% for
the year.
Asian stocks tracked Wall Street losses on Thursday as
latest exchanges between Beijing and Washington signalled the
heightened risk of a prolonged trade war. MKTS/GLOB
Provoking trade disputes is "naked economic terrorism", a
senior Chinese diplomat said on Thursday, ramping up the
rhetoric against the United States amid a bitter trade war that
is not showing any signs of ending soon. Bullion seems to have found a base around $1,270 even though
it has failed to break much higher, analysts said.
"With bond yields so low and weakening equity markets, gold
could find support. As far as the price remains above
$1,265-$1,270, gold will rally back to $1,306 and $1,316
levels," said Nicholas Frappell, global general manager at ABC
Bullion.
Meanwhile, holdings of SPDR Gold Trust GLD , the world's
largest gold-backed exchange-traded fund, rose 0.5% to 740.86
tonnes on Wednesday. GOL/ETF
Despite Wednesday's rise, SPDR gold holdings are down over
6% so far this year.
Gold ETF holdings have remained muted in spite of the
escalation in Sino-U.S. tensions, suggesting that investors are
looking at alternative sources of portfolio hedge, OCBC's Lee
said.
Among other precious metals, silver XAG= fell 0.1% to
$14.40 per ounce. The metal had dropped to $14.25 on Tuesday,
its lowest since early December.
Platinum XPT= rose 0.3% to $793.55 per ounce, after
earlier falling to its lowest since Feb. 15 at $785.50.
Palladium XPD= dropped 0.4% to $1,344 per ounce.