PRECIOUS-Gold drops to lowest since March 2017 on dollar, yuan moves

* Gold poised to test $1,200/oz - ABN AMRO

* Spot gold down 1.4 percent on week

* Silver heads for eighth weekly decline

(Adds analyst comments, updates prices, changes dateline from BENGALURU) LONDON, Aug 3 (Reuters) - A stronger dollar combined with a slump in the Chinese currency pushed gold down to the weakest in nearly 17 months on Friday and some analysts expect further downside.

Spot gold was unchanged at $1,207.56 an ounce at 0941

GMT, after earlier dropping to its lowest since March 15 last year at $1,204. For the week, it was down about 1.4 percent.

U.S. gold futures fell 0.4 percent to $1,215.70 an

ounce on Friday. "We have dollar strength, also versus the yuan, and that combination with the trade tension is putting downward pressure on the gold price," said Georgette Boele, commodity strategist at ABN AMRO in Amsterdam. The dollar climbed to a two-week high against a basket of major currencies and scaled a 14-month peak versus the Chinese yuan as worries about an escalation in trade tensions between the United States and China supported the U.S. currency. "They (speculators) really want to test the $1,200 level, but it should bottom out close to there. I think when people get back from holidays in September, they will probably say 'Oh, gold is very cheap, let's buy it'," Boele added. The greenback was also supported by strong U.S. economic data and an outlook for higher interest rates.

"The most recent data suggests continued weakness for gold amid a stronger U.S. dollar index," said John Sharma, an economist at National Australia Bank. Spot gold may fall towards the next support at $1,194, as it has resumed its downtrend from $1,309.30, according to Reuters technical analyst Wang Tao. Also weighing on the market was a report by the World Gold Council showing that global demand fell 6 percent in the first half of the year to the lowest level for the period since 2009.

"As long as the dollar remains strong we believe another couple of months demand should stay soft and prices should trade rather range bound," Julius Baer analyst Carsten Menke said in a note.

Among other precious metals, silver rose 0.1 percent

to $15.32 an ounce and was on track for an eighth straight weekly decline, its longest weekly losing streak since at least late 2000.

Platinum added 0.2 percent to $823.49 an ounce while palladium ticked 0.3 higher percent to $914.50 an ounce.

Both the metals were, however, headed for weekly losses.

(Additional reporting by Apeksha Nair in Bengaluru; Editing by Kirsten Donovan)