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PRECIOUS-Gold falls as hopes of U.S.-China trade truce boost riskier assets

* SPDR Gold holdings fall 0.2% on Wednesday

Gold up 7.4% so far this month despite Wednesday's fall

* Markets cut bets for half-point Fed rate cut in July (Updates prices)

By Sethuraman N R

June 27 (Reuters) - Gold prices fell on Thursday as hopes of a truce in the U.S.-China trade spat ahead of a weekend meeting at the G20 summit rekindled investors' interest in riskier assets, weighing on safe-haven bullion.

The South China Morning Post, citing sources, said Washington and Beijing were laying out an agreement that would help avert the next round of tariffs on an additional $300 billion of Chinese imports.

Spot gold was down 0.4% at $1,402.71 per ounce as of 0948 GMT, after shedding more than 1% in the previous session.

U.S. gold futures slipped 0.6% to $1,406.50 an ounce.

"The news that U.S. and China have agreed to a trade truce should help the risk sentiment in the market and growth outlook. That should weigh on the gold prices," SP Angel analyst Sergey Raevskiy said.

On Wednesday, U.S. President Donald Trump said a trade deal with his Chinese counterpart Xi Jinping was possible this weekend, though he was prepared to impose tariffs on virtually all remaining Chinese imports if talks fail.

The next move in gold could depend on how tensions between the United States and Iran pan out and the weekend G20 meeting, Raevskiy said, adding prices could go all the way back to $1,300 if there were positive developments on both fronts.

Gold has fallen more than $35 since touching a more than six-year peak on Tuesday, especially after officials from the U.S. Federal Reserve signaled they would not resort to a big interest rate cut in July.

However, gold prices are still up 7.4% so far this month, with prices gaining nearly $70 since last week alone on hopes there will be at least a quarter percentage point reduction in July by the Fed.

"The move in gold could be seen as a natural correction due to some profit taking after the impressive rally of the past few sessions," Carlo Alberto De Casa, chief analyst with ActivTrades, said in a note.

"Bullion seems to be consolidating, in conjunction with the modest recovery of the greenback seen in the last 48 hours. The medium-term scenario remains positive for the precious metal."

Meanwhile, holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.22% to 797.85 tonnes on Wednesday.

Among other precious metals, silver was steady at $15.24 per ounce and platinum eased 0.7% to $812.301

Palladium was steady at $1,522.05 an ounce. (Reporting by Nallur Sethuraman in Bengaluru; Editing by Mark Potter)