PRECIOUS-Gold gains as trade tariff deadline looms

(Updates prices)
* Palladium hits all-time high of $1,889.76/oz
* FOMC meeting commences on Tuesday
* GRAPHIC-2019 asset returns: http://tmsnrt.rs/2jvdmXl

By Karthika Suresh Namboothiri
Dec 9 (Reuters) - Gold rose on Monday as investors hedged
against a possible escalation in the U.S.-China trade dispute
ahead of a Dec. 15 deadline for fresh U.S. tariffs, while scarce
palladium surged to a new high as it closed in on the $1,900
mark.
Spot gold XAU= was up 0.3% to $1,463.92 per ounce by 1307
GMT. U.S. gold futures GCcv1 traded 0.2% higher at $1,468.40.
China's Assistant Commerce Minister Ren Hongbin said Beijing
hoped it could reach a trade agreement that satisfied both sides
as soon as possible, but investors seemed reluctant to let go of
gold amid diminishing hopes of a deal before Dec. 15.
"There will be enough uncertainty and support in the market
ahead of that date to keep the market stuck in this range," Saxo
Bank analyst Ole Hansen said.
Prices shed 1.1% on Friday after strong U.S. non-farm
payroll data. "Based on the (jobs) report, you could argue that gold
should be trading lower; it hasn't. It just goes to show that
there is quite a bit of scepticism about the outlook for global
growth," Hansen added.
Also providing support to bullion, China's exports shrank
for the fourth consecutive month in November, underscoring
pressure from the trade war. Markets now await the U.S. Federal Reserve's two-day meeting
starting on Tuesday for cues on its monetary policy. The central
bank is expected to highlight the economy's resilience and keep
interest rates on hold in the range of 1.50% to 1.75%.
FEDWATCH
Uncertainty driven by the Dec. 15 trade deadline and
Thursday's election in Britain, which could decide the fate of
Brexit, should underpin gold in a $1,445-$1,450 range, MKS PAMP
said in a note. U.S. investment bank Goldman Sachs, meanwhile, said
investment demand for gold would be supported by global fears of
recession and political uncertainty, forecasting prices at
$1,600 an ounce over a three- and 12-month period. Palladium XPD= hit an all-time high of $1,889.76 an ounce
on supply concerns. The autocatalyst metal was last up 0.5% at
$1,886.66.
"It's like a broken record because of the ongoing tight
fundamentals driving physical demand higher," Saxo Bank's Hansen
said.
"There's no appetite for physical selling because the market
is tight and speculative buyers have no reason to take profit
before we see any turn around in price action."
Platinum XPT= eased 0.2% to $894.37 an ounce, while silver
XAG= gained 0.5% to $16.64.