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PRECIOUS-Gold falls on profit-taking, but heads for weekly gain

K. Sathya Narayanan

* Gold up 1.3% so far this week

* Palladium falls 2%; on track for worst week since end-March

* Platinum, silver set for first weekly decline in four

* Markets eye U.S. non-farm payrolls report due later today (Adds comments, updates prices)

Aug 2 (Reuters) - Gold retreated on Friday, shedding as much as 1%, as investors booked profits following a 2% rise in the previous session after U.S. President Donald Trump threatened fresh tariffs on China.

Spot gold was down 0.6% at $1,436.45 per ounce by 1059 GMT in a volatile session which saw prices fall as much as 1% after scaling a two-week peak of $1,446.10 earlier.

The metal was still on course for a weekly gain of about 1.3%.

U.S. gold futures, meanwhile, were up 1.1% at $1,448.60.

ABN Amro analyst Georgette Boele said that as gold had not managed to test the $1452.6 high hit on July 19, a return to the $1,440-$1,450 range would see some investors continue to take profits, making it harder for prices to move higher.

However, gold could break above $1,450 if the dollar comes under pressure due to weak U.S. data, she added.

Trump said he would impose an additional 10% tariff on $300 billion worth of Chinese imports from next month and would raise it even further if trade negotiations fail to progress.

Market participants are now waiting for the release of U.S. non-farm payrolls data later in the session for cues on economic strength, two days after the Federal Reserve cut interest rates for the first time in a decade.

Lower interest rates tend to boost gold as it decreases the opportunity cost of holding non-yielding bullion and also weighs on the dollar.

Meanwhile, holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.5% to 827.82 tonnes on Thursday.

Spot gold may retest resistance at $1,449 per ounce, a break above which could lead to a rise into the $1,461-$1,474 range, according to Reuters technical analyst Wang Tao. Elsewhere, palladium fell 2% to $1,395.23 per ounce, after sliding below the $1,400 level for the first time since mid-June to its lowest level in more than seven weeks at $1,387.50, and on track for its worst week since late March.

Platinum was down 0.4% at $844.94 an ounce, while silver fell 1.1% to $16.14.

"The scenario is slightly more complicated for silver, as the component of the demand for this metal coming from the industrial sector is much higher than gold and the trade war could have a more significant impact," Carlo Alberto De Casa, Chief Analyst, ActivTrades, said in a note.

Both silver and platinum were headed for their first weekly decline in four.

(Reporting by K. Sathya Narayanan in Bengaluru; Editing by Kirsten Donovan)