PRECIOUS-Gold down after Trump says close to trade deal

(Updates prices)
* Palladium hits fresh record high of $1,944/oz
* Trump tweets deal with China "very close"
* ECB keeps rate unchanged at policy meeting
* GRAPHIC-2019 asset returns: http://tmsnrt.rs/2jvdmXl

By Karthika Suresh Namboothiri
Dec 12 (Reuters) - Gold retreated from an over one-month
peak in a volatile session on Thursday after U.S. President
Donald Trump said Washington was close to a trade deal with
China, denting the safe-haven metal's appeal.
Scarce palladium's record surge, meanwhile, showed no signs
of abating.
Spot gold XAU= dropped 0.5% to $1,468.17 per ounce as of
1:44 p.m. ET (1844 GMT). Prices hit their highest since Nov. 7
at $1,486.80 earlier in the session.
U.S. gold futures GCv1 inched down 0.2% to settle at
$1472.30.
Trump said the U.S. was "very close" to nailing down a deal
with China, helping world stocks soar to a record, and taking
some steam off gold's initial rally driven by the trade
uncertainties ahead of a Dec. 15 deadline when new U.S. tariffs
on Chinese goods come into effect. MKTS/GLOB
"(Trump's) tweet saw risk appetite bid, with capital flowing
to equities. The problem for gold is that when everything else
looks good, there's less incentive to move into gold, which is
what we've seen," said Bart Melek, head of commodity strategies
at TD Securities.
Also on investors' radar was the British election, which
will pave the way for Brexit under Prime Minister Boris Johnson
or propel Britain towards another referendum that could
ultimately reverse the decision to leave the European Union.
While major opinion polls suggest Johnson will win, any
surprises could add further support to bullion, analysts said.
Palladium XPD= , meanwhile raced to a fresh all-time high
of $1,944 in the session, up 1.4% at $1,936.99 an ounce.
The metal, set for a 15th straight gain, surpassed $1,900
for the first time on Tuesday as mines in major producer South
Africa shut after flooding triggered severe power blackouts.
"Palladium has been one of the stars of not just the metals,
but the commodities arena overall for the year," said David
Meger, director of metals trading at High Ridge Futures.
"Just the power outages bring about more supply constraints
to what is already a tightly supplied market with strong
demand."
Platinum XPT= rose 0.3% to $941.70 an ounce, having
earlier touched an over one-month peak of $948.11.
Silver XAG= was also up 0.3% to $16.90.