PRECIOUS-Gold rises as dollar dips on prospect of higher U.S. aid

(Updates prices)
* Gold break above $1,900/oz could end downtrend - analyst
* Dollar index eases 0.4%
* U.S. Senate set to vote on COVID-19 relief checks on
Tuesday
* Interactive graphic tracking global spread of coronavirus:
https://tmsnrt.rs/3mvcUoa

By Asha Sistla
Dec 29 (Reuters) - Gold prices rose on Tuesday as the dollar
weakened after the approval of larger coronavirus relief checks
by Democratic-led U.S. House of Representatives, while improved
risk appetite kept it below last session's one-week high.
Spot gold XAU= rose 0.4% to $1,879.24 per ounce by 1333
GMT. The metal climbed as much 1.3% on Monday after U.S.
President Donald Trump's approval of a $2.3 trillion stimulus
package.
U.S. gold futures GCv1 rose 0.2% to $1,884.60.
"Gold is trading technically as well with underlying support
coming from the weaker dollar driven by the prospect potentially
of an even bigger check being distributed to U.S. consumers,"
said Saxo Bank analyst Ole Hansen.
"We are entering 2021 with some nervousness as we got stock
markets at elevated levels and (on) prospects of additional
stimulus against the prospect of vaccine starting to improve the
economic outlook... but overall it hasn't reduced the appetite
for safe-haven metals."
European stocks extended their year-end rally, while the
dollar index .DXY fell 0.4% against rival currencies on hopes
of an expanded U.S. stimulus package with the U.S. Senate set to
vote on $2,000 COVID-19 relief checks. .EU USD/ Capping bullion's gains was a marathon COVID-19 vaccination
campaign across the euro zone, cheering up prospects of global
growth in 2021. Broader markets will run with the economic recovery story
next year but expansionary fiscal and loose monetary policy will
keep gold prices pinned near current levels, said Hitesh Jain,
lead analyst at Mumbai-based Yes Securities.
The metal should trade in a range between $1,850-$2,000 in
the next three to six months, he said.
Gold, seen as a hedge against inflation, has risen about 23%
this year, largely driven by a raft of stimulus measures
unleashed to mitigate the impact of the pandemic.
Silver XAG= was up 0.1% at $26.18 an ounce. Platinum
XPT= rose 0.8% to $1,039.21 and palladium XPD= gained 0.8%
to $2,342.46.