PRECIOUS-Gold cuts gains after U.S. data, Fed stimulus eyed
* Dollar pares losses after U.S. economic data
* Data stirs expectation of December tapering
* China's imports from Hong Kong highest in 7 months
LONDON, Nov 27 (Reuters) - Gold was flat on Wednesday, cutting initial gains as the dollar steadied after a series of U.S. economic data supported expectations the Federal Reserve will soon scale back monetary stimulus.
With the Thursday Thanksgiving holiday in the United States approaching, market activity is expected to slow and not pick up until next week, traders said.
Spot gold was unchanged at $1,242.66 an ounce by 1530 GMT after rising nearly 1 percent earlier in the day. It lost nearly 1 percent in the previous session after strong U.S. housing data.
U.S. gold futures rose 0.1 percent to $1,242.40 an ounce.
Technical analysts said that as long as gold remained below $1,300 it faced the risk of further declines.
The dollar edged up 0.1 percent against a basket of currencies after U.S. data showed weekly jobless claims had unexpectedly fallen.
Separately, orders for durable goods in October fell 2 percent, compared with an expected 1.9 percent decline, and U.S. consumer sentiment rose in November as wealthier Americans' outlook on the economy improved.
"Gold remains very sensitive to the U.S. data, and we saw that it cut initial gains after today's mixed numbers," ABN Amro analyst Georgette Boele said.
"It looks like investors are looking for reasons to push the price lower, and any bounce higher runs quickly out of steam."
The next major data release, non-farm payroll figures, is scheduled for Dec. 6. The Fed's next policy meeting will be held Dec. 17-18.
"If the nonfarm payrolls next week come in above consensus, I think we will see lower gold prices," Boele said.
The gold price has fallen by more than 25 percent this year as investors have pulled money out of bullion to invest in higher-yielding equities on signs the U.S. central bank would start withdrawing stimulus.
Economists polled by Reuters expect the Fed to begin tapering in March, with a small chance it could do so as early as January.
Until then, the central bank will carry on creating $85 billion of new money every month by purchasing bonds for its own portfolio.
China's net gold imports from Hong Kong hit the highest in seven months in October, data showed.
China is set to overtake India as the biggest gold consumer this year. Rules introduced by the Indian government to reduce a high current account deficit have curbed demand for gold, the second-largest item on its import bill after oil.
Chow Tai Fook Jewellery Group, the world's largest jewellery retailer by market value, posted a 92 percent rise in net profit for the six months ended in September.
Silver rose 0.7 percent to $19.94 an ounce, while spot platinum rose 0.5 percent to $1,374.84 an ounce and spot palladium gained 0.7 percent to $720.97 an ounce.