Jan 15 (Reuters) - Gold prices on Monday hit their highest since September, buoyed as the U.S. dollar slumped to three-year lows against a basket of currencies.
* Spot gold was up 0.1 percent at $1,339.46 an ounce by 0117 GMT, after earlier touching its strongest since Sept. 6 at $1,339.97
* Spot gold rose for a fifth straight week last week, gaining 1.4 percent.
* U.S. gold futures were up 0.4 percent at $1,339.70 an ounce.
* Spot gold prices rose 1 percent on Friday after U.S. President Donald Trump said he would waive nuclear sanctions against Iran for the last time to give Washington and its European allies a chance to fix the "terrible flaws" of the 2015 nuclear deal.
* Asian shares hit historic highs on Monday as Wall Street extended its record-breaking run, while the U.S. dollar remained on the defensive as investors priced in the risk of tighter policies elsewhere in the rich world.
* The dollar index on Monday dropped 0.2 percent to 90.800 , its lowest since Jan. 2015.
* U.S. producer prices fell for the first time in nearly 1-1/2 years in December amid declining costs for services, which could temper expectations that inflation will accelerate in 2018.
* Underlying U.S. consumer prices recorded their largest increase in 11 months in December on strong gains in the cost of rental accommodation and healthcare, bolstering expectations that inflation will accelerate this year.
* The recent drop in U.S. unemployment could spark a surge in inflation that, given the Federal Reserve's current policy framework, could trigger interest-rate hikes that bring on a recession, Boston Federal Reserve President Eric Rosengren warned on Friday.
* Palladium hit a record-high of $1,126.30 an ounce on Friday. It was down 0.4 percent at $1,119.49 early on Monday. The metal has seen a sustained rally from high demand in the auto industry amid a supply deficit
* Hedge funds and money managers raised their net long positions in COMEX gold and silver contracts in the week to Jan. 9, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.
DATA AHEAD (IN GMT)
1000 Euro Zone Trade data Nov
(Reporting by Nallur Sethuraman in Bengaluru; Editing by Joseph Radford)