PRECIOUS-Gold eases as WHO tempers virus fears

(Adds details, comments; Updates prices)
* China gears up for Lunar New Year celebrations
* Silver set to post biggest weekly decline since early
December
* Palladium, platinum on track to post worst week in five

By Diptendu Lahiri
Jan 24 (Reuters) - Gold edged down on Friday as the dollar
rose and the appetite for riskier assets improved after the
World Health Organisation tempered fears of a global coronavirus
outbreak.
Spot gold XAU= was 0.3% lower at $1,557.93 per ounce by
1300 GMT but held above the key $1,550 level, supported by the
prospect of easy monetary policy globally.
U.S. gold futures GCcv1 slipped 0.5% to $1557.50 per
ounce.
"Gold prices are facing headwinds from gaining equities and
a stronger dollar but it is unlikely to fall below $1,520 as a
bunch of geo-political uncertainties still exist," Saxo Bank
analyst Ole Hansen said.
European shares gained after the WHO designated the
coronavirus outbreak an emergency for China but not yet for the
rest of the world. MKTS/GLOB
However, the spread of the virus ahead of the Lunar New
Year, a peak period of travel and gold demand in China, kept
investor concerns heightened.
Furthermore, the dollar .DXY hovered close to a more than
one and half month high against a basket of currencies, making
gold expensive for buyers holding other currencies. USD/
"With a low interest rate environment, geopolitical risks
and uncertainties such as U.S. President's impeachment, the
conditions are still quite conducive to further upside in gold,"
ANZ analyst Daniel Hynes said. After the European Central Bank left rates unchanged on
Thursday, investors are looking to the U.S. Federal Reserve's
first meeting of the year scheduled on Jan. 28-29.
However, in the short-term, "the Libya oil issue and the
coronavirus have not helped (gold) much and if this continues,
we might see a challenging quarter ahead," Saxo Bank's Hansen
said.
Libya earlier this week declared force majeure on two major
oilfields following a military blockade, and protests escalated
in Iraq, pushing investors towards safe-haven assets.
Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust GLD , rose 0.2% to 900.58 tonnes on
Thursday. GOL/ETF
Elsewhere, palladium XPD= dipped 0.6% to $2,447.11 per
ounce, and was on track to register its first weekly fall in
five at about 1.3%.
Silver XAG= rose 0.2% to $17.82 per ounce but was set to
post its biggest weekly decline since early-December at nearly
1%. Platinum XPT= rose 0.2% to $1,004.44, but was down 1.4%
for the week, its worst since the week ended Dec. 20.