PRECIOUS-Gold edges up on weaker stocks, dollar ahead of Fed meeting

* Fed meeting starts on Tuesday

* Focus on pace of Fed rate hikes

* Palladium shies away from Friday's 16-year high

(Adds quotes, updates prices) BENGALURU, June 12 (Reuters) - Gold inched up on Monday as Asian stocks fell and the dollar eased ahead of a U.S. Federal Reserve policy meeting that could give clues on the pace of interest rate hikes over the rest of the year. With the Fed widely expected to raise interest rates at its two-day meeting that ends on Wednesday, the focus will be on any fresh hints on the pace of further tightening in the months to come and next year, and any further details on its plans for trimming its balance sheet. The focus is on whether the Fed is looking at three or four rate hikes this year, according to Argonaut Securities analyst Helen Lau. Higher interest rates tend to boost the dollar and bond yields, putting pressure on gold prices by increasing the opportunity cost of holding non-yielding bullion. "With the UK event risk successfully negotiated, it would appear the market is putting more emphasis on this week's FOMC (Federal Open Market Committee) rate hike," said Jeffrey Halley, a senior market analyst with OANDA, adding that markets had priced in an almost 100 percent chance the Fed would lift rates. The market is also anxious to see if the Fed becomes more dovish in its outlook, he said.

Spot gold was up 0.1 percent at $1,267.49 an ounce as

of 0411 GMT, after shedding 1 percent in its biggest one-day percentage decline since May 18 in the previous session

U.S. gold futures for August delivery fell 0.2

percent to $1,269.50. In the wider markets, Asian stocks edged lower in early trade on Monday following a slide by U.S. technology shares.

The dollar index against a basket of currencies dipped 0.1

percent to 97.176 following its rise to a nine-day high

of 97.500 on Friday.

Among other metals, spot palladium fell 0.7 percent

to $884.49 per ounce after hitting a 16-year high on Friday.

Silver was flat at $17.16 per ounce, while platinum

rose 0.3 percent to $936.45 per ounce.

(Reporting by Nithin Prasad in Bengaluru; Editing by Joseph Radford and Subhranshu Sahu)