PRECIOUS-Gold gains on dollar weakness and trade uncertainty

* Break above $1,515 could prompt further gold gains
-analyst
* Palladium on course for third straight monthly gain

(Updates prices)
By Karthika Suresh Namboothiri
Oct 31 (Reuters) - Gold rose on Thursday as the dollar came
under pressure after the U.S. Federal Reserve cut interest rates
while uncertainty surrounding a U.S.-China trade deal bolstered
the metal's appeal as a safe-haven investment.
Prices also got a further boost after U.S. weekly jobless
claims rose more than expected last week. Spot gold XAU= climbed 0.9% to $1,507.98 an ounce by 1258
GMT, having earlier risen to a nearly one-week high of $1509.80.
Prices were set for a monthly gain of more than 2%.
U.S. gold futures GCcv1 were up 0.9% at $1,510.40.
The U.S. central bank on Wednesday cut interest rates for
the third time this year to help to sustain U.S. growth despite
a slowdown in other parts of the world. "While the central bank signalled a pause in further cuts
for now, it also seemed to pre-commit to keep rates low for the
foreseeable future," said Ilya Spivak, a senior currency
strategist at DailyFx, adding that a resulting dip in U.S.
Treasury bond yields and the dollar were helping gold.
The U.S. dollar .DXY fell to a more than one-week low
against leading rivals. USD/ US/
Gold is highly sensitive to any reduction in interest rates,
which decreases the opportunity cost of holding non-yielding
bullion. Rate cuts also weigh on the dollar, in which gold is
priced.
Uncertainties on the trade front also supported bullion,
with the cancellation of an Asia-Pacific economic cooperation
summit in Chile next month, at which the United States and China
were expected to sign an interim deal to ease hostilities in
their long-running trade war.
"China said that, most probably, a long-term trade deal is
not really possible with Trump; so all that is really helping
gold prices higher," said Afshin Nabavi, senior vice president
at precious metals trader MKS SA.
"Underlying momentum is still positive for gold. For prices
to accelerate, we need to break above $1,515, and if that is
done, we should be able to get more fresh blood coming into the
market."
However, news that Beijing could remove extra tariffs
imposed since last year on U.S. farm products fanned hopes that
a trade deal remains possible. Elsewhere, palladium XPD= was down 0.6% at $1,794.47 an
ounce, having hit a record high of $1,824.50 on Wednesday. The
autocatalyst metal was set for a third straight monthly gain, up
7% in October alone.
"There is so much demand but not enough supply, that's why a
lot of backwardation is still continuing and for the time being
it looks like $1,900 is on the cards," Nabavi said.
Silver XAG= rose 1.1% to $18.06 an ounce while platinum
XPT= firmed by 0.9% to $933.87, with both metals set for
monthly gains.