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PRECIOUS-Gold treads water below $1,300 as Fed, economic data eyed

SINGAPORE, July 30 (Reuters) - Gold was trading in a tight range below $1,300 an ounce on Wednesday, as investors nervously awaited the end of a Federal Reserve policy meeting to gauge the U.S. central bank's view on the economy and monetary policy. The metal was also pressured by the U.S. dollar, which hovered at a six-month high on expectations of strong economic data and a hawkish tone from the Fed.

FUNDAMENTALS

* Spot gold was flat at $1,299.29 an ounce by 0024 GMT, after slipping 0.5 percent and breaking below the key $1,300 level in the previous session.

* The Fed will make a statement later today at the end of its two-day policy meeting, with markets watching for clues on when the U.S. central bank will begin increasing interest rates.

* Recent strong economic data has prompted many to believe that the Fed may raise rates sooner than expected. Higher rates would encourage investors to withdraw money from non-interest-bearing assets such as gold.

* Investors were also reluctant to take big positions ahead of major U.S. economic data this week, including GDP on Wednesday and non-farm payrolls on Friday.

* While the focus will be on the Fed statement, markets are also eyeing developments on the geopolitical front for any worsening of tensions in the Middle East and Ukraine.

* The European Union and the United States on Tuesday announced further sanctions against Russia, in the strongest international action yet over Moscow's support for rebels in eastern Ukraine.

* Israel knocked out Gaza's only power plant and pounded dozens of other high-profile targets on Tuesday, while Egyptian mediators prepared a revised proposal for halting its war with Islamist guerrillas in the enclave.

* The operator of the gold price 'fix' said on Tuesday the process to find a new administrator for the century-old benchmarking system will last one month from late August, and will be working by the end of 2014.

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MARKET NEWS

* The U.S. dollar hovered at a six-month peak against a basket of major currencies early on Wednesday, having pushed higher as investors continued to give the euro a wide berth. World equity markets fell on Tuesday.

DATA/EVENTS (GMT) 0645 France Consumer confidence July 0900 Euro zone Business climate July 1200 Germany Consumer inflation July 1215 U.S. ADP national employment July 1230 U.S. GDP Advance Q2 1800 Federal Reserve releases statement after 2-day meeting

PRICES AT 0024 GMT

Metal Last Change Pct chg Spot gold 1299.29 1.19 0.09 Spot silver 20.56 0.04 0.19 Spot platinum 1478.49 5.99 0.41 Spot palladium 880.9 5.7 0.65 Comex gold 1299 0.7 0.05 Comex silver 20.61 0.027 0.13 Euro 1.341 DXY 81.205

COMEX gold and silver contracts show the most active months

(Reporting by A. Ananthalakshmi; Editing by Richard Pullin)