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PRECIOUS-Gold falls to 2-1/2-week low in thin trade; fund outflows weigh

* Gold retreats from early climb to $1,300 in choppy trade

* Australia, Hong Kong, London closed for Easter

* SPDR outflows totalled 9.3 tonnes last week

(Adds analyst's comments, fund holdings; updates prices) SINGAPORE, April 21 (Reuters) - Gold fell to a two-and-a-half-week low in choppy and thin holiday trade on Monday, hurt by sharp outflows from the world's biggest bullion-backed exchange-traded fund (ETF) and a stronger dollar. The metal was also impacted by a spurt of technical selling after it was unable to hold on to the $1,300-an-ounce level hit early in the trading session. Spot gold fell to a two-and-a-half-week low of $1,281.40, before pruning the losses to trade down 0.6 percent at $1,286.41 by 0353 GMT. "One aspect is that the market is pretty thin today and liquidity is going to be constrained," said Victor Thianpiriya, an analyst at ANZ. Australia, Hong Kong and London are closed on Monday for the Easter holiday. "But people have been spooked by the near 10-tonne decline in SPDR holdings that we saw last week." SPDR Gold Trust, the world's top gold ETF and a good measure of investor sentiment, saw outflows of 9.3 tonnes last week. Before last week, the fund - closely watched due to the size of its holdings - had gained 6.2 tonnes from the beginning of 2014. Last year, huge outflows from the fund were partly responsible for the 28 percent drop in gold's price. Investors shifted money to better-performing equities as the U.S. Federal Reserve began to unwind its monetary stimulus. Due to the fund outflows, bullion investors have largely ignored the heightened geopolitical tensions in Ukraine which had earlier lent some safe-haven support for the metal. At least three people were killed in a gunfight in the early hours of Sunday near a Ukrainian city controlled by pro-Russian separatists, shaking an already fragile international accord that was designed to avert a wider conflict. The dollar index edged up 0.1 percent on Monday. A stronger greenback makes the dollar-denominated metal more expensive for holders of other currencies. Physical demand remained quiet in Asia, led by subdued interest in top buyer China, where a weaker yuan has dented bullion imports. In news from the gold mining industry, the Wall Street Journal reported that merger talks between Barrick Gold Corp and Newmont Mining Corp, the world's top two gold producers, broke down in the past few days.

PRICES AT 0353 GMT

Metal Last Change Pct chg Spot gold 1286.41 -7.24 -0.56 Spot silver 19.31 -0.28 -1.43 Spot platinum 1406 1.2 0.09 Spot palladium 790.65 -3.35 -0.42 Comex gold 1286.7 -7.2 -0.56 Comex silver 19.315 -0.281 -1.43 Euro 1.381 DXY 79.892

COMEX gold and silver contracts show the most active months

(Editing by Joseph Radford and Muralikumar Anantharaman)