PRECIOUS-Gold dips as U.S.-China trade optimism boosts riskier assets

K. Sathya Narayanan

(Updates prices)

* U.S. dollar holds near 5-month low

* Palladium hits record high of $1,964.56/oz

* Silver, platinum eyes best week since end-Oct

* GRAPHIC-2019 asset returns: http://tmsnrt.rs/2jvdmXl

Dec 13 (Reuters) - Gold prices inched down on Friday, as investors' appetite for riskier assets increased on reports of a breakthrough in Sino-U.S. trade negotiations, while palladium scaled a record peak.

Spot gold fell 0.2% to $1,466.60 per ounce by 0646

GMT, but was up about 0.5% so far this week.

U.S. gold futures were down 0.1% at $1,471.

U.S. stocks surged to record highs, while Asian equities rose to an eight-month peak, making safe-haven risk-off assets such as gold less appealing. "The market remains cautious... Until we see little bit more data around what has been agreed to, investors aren't going to take any aggressive positioning in the gold market," ANZ analyst Daniel Hynes said. "Gold has been driven by other issues, including central bank easing and low inflation, and that is helping support underlying investors appetite despite headwinds in the shorter term," he said. Sources said on Thursday U.S. negotiators were offering to cut existing tariffs on Chinese goods by as much as 50% and suspend the new tariffs scheduled to go into effect on Sunday in an attempt to secure a "Phase 1" deal first promised in October.

The dollar was hovering close to its lowest since

early-July hit in the previous session, putting a floor under gold prices. Meanwhile, the European Central Bank kept its monetary policy unchanged on Thursday, while Christine Lagarde struck a more upbeat tone on the economy in her first news conference as its head. In the previous session, gold scaled an over one-month high before ending the day lower. Bullion gained after data from the United States showed "higher-than-expected jobless claims" and any signs of weakness in the economy "likely to elicit support for gold," ANZ's Hynes added. Market participants are also awaiting the November U.S. Retail Sales data, due later in the day.

Elsewhere, palladium rose 0.9% to $1,957.46 an ounce,

having notched an all-time high of $1,964.56 earlier in the session. Plagued by supply deficit, the auto-catalyst has gained about 4% so far this week, predominantly supported by mine closures across South Africa, a major producer of the metal.

Platinum fell 1.3% to $932.08 per ounce, while silver

dipped 0.3% to $16.88 per ounce. Both the metals were set to post their best weekly gain since end-October.

(Reporting by K. Sathya Narayanan in Bengaluru; editing by Uttaresh.V and Rashmi Aich)