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PRECIOUS-Gold holds above $1,270, eyes on Fed

SINGAPORE, June 18 (Reuters) - Gold was trading in a tight range on Wednesday as a firmer dollar and outflows from bullion funds sapped demand, with many investors waiting for the Federal Reserve to conclude its two-day policy meeting before placing big bets on the metal.

FUNDAMENTALS

* Spot gold was little changed at $1,270.94 an ounce by 0028 GMT, after ending flat in the previous session. The metal hit a three-week high of $1,284.85 on Monday due to violence in Iraq, but prices have since fallen back.

* SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.26 tonnes to 782.62 tonnes on Tuesday - a second straight day of declines.

* The fund, considered a proxy for investor sentiment, posted its biggest outflow since mid April on Monday.

* The Fed is widely expected to chop another $10 billion from its monthly bond purchases at a meeting on Tuesday and Wednesday. Markets will be watching closely for any commentary on when the U.S. central bank would begin to rise interest rates and its outlook for the economy.

* In the physical markets, gold premiums in India - the world's second biggest gold buyer - fell to their lowest in four months as the central bank allowed private companies to import gold even as demand was soft.

* Platinum and palladium edged higher as South Africa's platinum producers and union AMCU agreed on a broad wage offer to end a protracted strike. Details such as the time frame and additional benefits are still outstanding, a producer said on Tuesday.

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MARKET NEWS

* The U.S. dollar held onto modest gains early on Wednesday, having risen broadly after U.S. consumer prices recorded their largest increase in more than a year in May.

DATA/EVENTS (GMT) 0130 China House prices May 1230 U.S. Current account Q1 1800 Federal Reserve announces outcome of policy meeting 1830 Fed Chair Janet Yellen holds news briefing

PRICES AT 0028 GMT

Metal Last Change Pct chg Spot gold 1270.94 -0.25 -0.02 Spot silver 19.71 0.02 0.1 Spot platinum 1432.9 0.4 0.03 Spot palladium 814.68 1.38 0.17 Comex gold 1271.4 -0.6 -0.05 Comex silver 19.735 0.003 0.02 Euro 1.3547 DXY 80.6

COMEX gold and silver contracts show the most active months

(Reporting by A. Ananthalakshmi; Editing by Michael Perry)