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PRECIOUS-Gold drifts from one-month peak on Fed rate hike concerns

May 31 (Reuters) - Gold edged lower on Wednesday, moving away from a one-month peak hit in the previous session as U.S. economic data boosted the case for an interest rate hike by the Federal Reserve next month.

FUNDAMENTALS

* Spot gold was down 0.2 percent to $1,260.60 per ounce at 0101 GMT. It touched a one-month high of $1,270.47 before pulling back 0.3 percent on Tuesday.

* U.S. gold futures dipped 0.2 percent to $1,260.

* U.S. consumer spending recorded its biggest increase in four months in April and monthly inflation rebounded, pointing to firming domestic demand that could allow the Federal Reserve to raise interest rates next month.

* A U.S. rate hike is probably coming soon though the Federal Reserve may want to delay if inflation remains soft, influential Fed governor Lael Brainard said on Tuesday, adding she also backs shrinking the bond portfolio "before too long."

* Two of the Federal Reserve's 12 regional banks supported raising the discount rate ahead of the central bank's May meeting, according to minutes of the discount rate discussions released on Tuesday.

* British Prime Minister Theresa May's Conservative Party risks falling short of winning an overall majority of seats in parliament in a national election on June 8, The Times newspaper said on Tuesday, quoting research by polling firm YouGov.

* European Central Bank policymakers are set to take a more benign view of the economy when they meet on June 8 and will even discuss dropping some of their pledges to ramp up stimulus if needed, four sources with direct knowledge of the discussions told Reuters.

* German consumer inflation eased more than expected in May to fall well below the European Central Bank's 2 percent target, data showed on Tuesday, taking some pressure off the ECB to wind down its monetary stimulus in the near term.

* Greece on Tuesday denied a German newspaper report it could refuse receipt of bailout loans needed to make a July debt repayment if its lenders fail to offer clear debt relief terms, despite it having passed more reforms.

DATA AHEAD (GMT)

0100 China Official manufacturing PMI May 0100 China Official non-manufacturing PMI May 0600 Germany Retail sales Apr 0645 France Producer prices Apr 0800 Germany Unemployment rate May 0900 Euro zone Inflation May 0900 Euro zone Unemployment rate Apr 1400 U.S. Pending homes sales Apr

(Reporting by Vijaykumar Vedala in Bengaluru; Editing by Richard Pullin)