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PRECIOUS-Gold hits 6-week trough as dollar grinds higher

    * Silver falls as much as 5.6% to a two-month low
    * Platinum touches 2 month-low
    * Break-back above $1,900 should be difficult for gold
-analyst
    * Interactive graphic tracking global spread of coronavirus:
here

 (Adds comments, updates prices)
    By Nakul Iyer
    Sept 23 (Reuters) - Gold dropped to a six-week low on
Wednesday as the dollar held onto its recent rally, while a lack
of additional stimulus to aid the recovery of the
coronavirus-battered global economy further weighed on
sentiment.    
    Spot gold        fell 0.8% to $1,884.51 per ounce by 1157
GMT, after earlier dropping 1.4% to touch its lowest since Aug.
12 at $1,873.01. U.S. gold futures        were down 0.9% to
$1,891.30 per ounce.
    "As long as we see strength in the dollar, undoubtedly we
are also going to see gold struggle," said Saxo Bank analyst Ole
Hansen, adding that the break below $1,900 sparked some
nervousness and short-selling in the market. 
    The dollar index        hit an eight-week high, dimming the
appeal of bullion to holders of other currencies.
    "I think gold has entered a corrective phase...A break-back
above $1,900 should be difficult given how long its taken to
break and hold below here," said OANDA analyst Craig Erlam.
    But even if it does, the near-term outlook isn't good for
gold with a stronger dollar weighing on the outlook and a lot of
the bullish factors already priced in, he added.             
    Comments from Chicago U.S. Federal Reserve President Charles
Evans, who said interest rates could be raised before inflation
averages 2%, also weighed on sentiment by weakening inflation
expectations and lifting U.S. real yields.
                        
    Gold has turned "passive", having priced all of the
favourable factors already and now needs inflation to emerge and
a weaker dollar to attract renewed demand, said Saxo Bank's
Hansen. 
    Non-yielding gold is often seen as a hedge against inflation
and currency weakening.              
    Silver        fell 4.1% to $23.41 per ounce, having hit a
nearly two-month low of $23.04 earlier in the session. 
    Platinum        shed 0.7% to $861.08 per ounce, earlier
touching its lowest since July 21 at $845.50, and palladium
       was little changed at $2,220.57. 

 (Reporting by Nakul Iyer in Bengaluru, Editing by Tomasz
Janowski/Mark Heinrich)
  
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