PRECIOUS-Gold slips as risk sentiment improves

* European stocks open higher
* Dollar index down 0.2%
* Interactive graphic tracking global spread of coronavirus:
open
https://tmsnrt.rs/3aIRuz7 in an external browser

(Updates prices)
By Diptendu Lahiri
Aug 25 (Reuters) - Gold prices fell on Tuesday as hopes
surrounding a potential COVID-19 vaccine and positive signals on
the U.S.-China trade front buoyed risk sentiment and offset
support for the metal from a weaker dollar.
Spot gold XAU= fell 0.3% to $1,926.06 per ounce by 1144
GMT. U.S. gold futures GCv1 were down 0.2% to $1,936.10 per
ounce.
"A stronger equity market is attracting investors more and
that is erasing all the positive effects of a weaker dollar on
gold," said Commerzbank analyst Eugen Weinberg.
European shares gained, with investor confidence boosted by
Washington and Beijing stating they were both dedicated to their
Phase One trade agreement, and some renewed hopes about the
production of COVID-19 vaccines. MKTS/GLOB
Investors are now looking forward to see if the U.S. Federal
Reserve "will tolerate inflation and put economic growth over
monetary (growth)," Commerzbank's Weinberg said.
Fed Chair Jerome Powell is due to speak at a gathering of
central bankers in Jackson Hole, Wyoming, on Thursday, where he
is expected to provide further clarity on the U.S. central
bank's efforts to revamp its approach to monetary policy.
"We've seen a pullback in gold since the beginning of the
month around the sense that maybe the Fed is not going to do
much in terms of expanding its policy tool kit," said DailyFx
currency strategist Ilya Spivak.
Still, gold remained comfortably above the key $1,900 mark
and was up nearly 27% so far this year, with a raft of fiscal
and monetary support initiatives, including near-zero interest
rates, to ease the economic blow from the pandemic pushing
investors to the metal as a refuge from inflation and currency
debasement.
Meanwhile, the dollar index .DXY fell 0.2% against its
rivals on Tuesday, rendering gold cheaper for buyers in other
currencies.
Elsewhere, silver XAG= fell 0.1% to $26.52 per ounce,
platinum XPT= rose 1.3% to $927.88, and palladium XPD= was
down 0.5% at $2,149.74 per ounce.

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