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PRECIOUS-Gold hits 2-wk high on Trump concerns, weaker US housing data

May 17 (Reuters) - Gold prices hit a two-week high on Wednesday as Asian stocks slipped and the dollar was pressured after underwhelming U.S. housing data and reports that U.S. President Donald Trump sought an end to an FBI probe into his former security adviser.

FUNDAMENTALS

* Spot gold had climbed 0.5 percent to $1,242.92 per ounce by 0059 GMT, after earlier touching its strongest since May 3 at $1,244.70. It rose about 0.5 percent on Tuesday in its biggest one-day percentage gain since April 12.

* U.S. gold futures were up 0.5 percent at $1,242.90 an ounce.

* Trump asked then-FBI Director James Comey to end the agency's investigation into ties between former White House national security adviser Michael Flynn and Russia, according to a source who has seen a memo written by Comey.

* The Comey memo, first reported by the New York Times, caused alarm on Capitol Hill and raised questions about whether Trump tried to interfere with a federal investigation. The White House quickly denied the report.

* The dollar nursed its losses on Wednesday after taking a combination of punches - solid eurozone economic data, a fall in U.S. yields on the heightened turmoil in Washington and downbeat housing data that reduced expectations of a Federal Reserve rate hike next month.

* The dollar's index against a basket of six major

currencies was near its lowest levels since Nov. 9 and

last stood at 98.081.

* MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.2 percent.

* U.S. manufacturing production recorded its biggest increase in more than three years in April, bolstering the view that economic growth picked up early in the second quarter despite a surprise decline in homebuilding.

* The U.S. economy is forecast to expand at a 4.1-percent annualized pace in the second quarter following the release of April figures on housing starts and industrial output, the Atlanta Federal Reserve's GDP Now forecast model showed on Tuesday.

* North Korea's missile program is progressing faster than expected, South Korea's defense minister said on Tuesday, after the U.N. Security Council condemned the weekend launch of a new long-range missile and demanded Pyongyang halt weapons tests.

* Policy uncertainty in South Africa and low commodity prices are hurting investment in the mining sector and will lead to further job cuts, the chief executive of the world's biggest

platinum miner, Anglo American Platinum (Amplats) , said

on Tuesday.

DATA/EVENT AHEAD (GMT)

0900 Euro zone inflation final Apr

(Reporting by Vijaykumar Vedala in Bengaluru; Editing by Joseph Radford)