PRECIOUS-Gold retreats from 2-week peak as investors lock in profits

(Updates prices)
* Silver hits five-month high
* SPDR Gold holdings rose 0.5% on Wed
* Dollar slips from one-week peak

By Harshith Aranya and Brijesh Patel
July 18 (Reuters) - Gold prices pulled back from a two-week
high to trade lower on Thursday, as some investors took
advantage of the last session's gain to book profits.
Spot gold XAU= was down 0.4% at $1,420.60 per ounce, as of
0736 GMT, after hitting its highest since July 3 at $1,428.40.
It rose nearly 1.5% in the previous session as the dollar
slipped after weaker-than-expected U.S. housing data increased
prospects for an interest rate cut by the Federal Reserve.
U.S. gold futures GCv1 edged 0.1% lower to $1,421.60 an
ounce.
"A slightly weaker dollar and a clear preference from
investors over the last 24 hours drove safe-haven assets
higher," said Michael McCarthy, chief market strategist, CMC
Markets.
"From gold's point of view, it approached a key resistance
level around $1,430, and having failed to push through it, it
looks like short-term trading investors are taking advantage of
gains."
The dollar index .DXY was down 0.2% against a basket of
major currencies on Thursday. It climbed to a one-week peak in
the previous session on robust U.S. retail sales, but nudged
lower as Treasury yields fell in the wake of weak U.S. housing
market data and concerns about the unresolved U.S.-China trade
conflict. US/ USD/
Meanwhile, the Fed is widely expected to lower interest
rates by 25 basis points at its policy meeting at the end of the
month, with some in the market even betting on a 50 basis point
cut.
The Fed reported on Wednesday that the U.S. economy
continued growing at a "modest" rate in recent weeks, with
consumers continuing to spend and a "generally positive" outlook
overall even in the face of disruptions caused by the U.S. trade
policy. Earlier in the week, U.S. President Donald Trump kept up the
pressure on Beijing with a threat to put tariffs on another $325
billion of Chinese goods. "Bullion is likely to see strong support after the Fed's
Beige Book emphasised policymakers' concern on negative impact
of trade uncertainty," Edward Moya, a senior market analyst at
OANDA, said in a note.
Indicative of sentiment, holdings of SPDR Gold Trust GLD ,
the world's largest gold-backed exchange-traded fund, rose 0.48%
to 803.18 tonnes on Wednesday from 799.37 tonnes on Tuesday.
GOL/ETF
Among other precious metals, silver XAG= was up 0.1% at
$15.99 per ounce, after hitting its highest since Feb. 20 at
$16.12. The metal was on track for a fifth consecutive session
of gains.
Platinum XPT= rose 0.6% to $848.11 an ounce and palladium
XPD= gained 0.1% to $1,538.95.