PRECIOUS-Gold breaches $1,550 mark for first time in over 6 years on trade jitters

* SPDR Gold holdings rose 0.6% on Friday
* Silver near two-year high
* Trump says China wants to negotiate

(Updates prices)
By Brijesh Patel
Aug 26 (Reuters) - Gold prices jumped more than 1% to
surpass the $1,550 per ounce mark for the first time in more
than six years on Monday as investors flocked to safe haven
assets driven by the heightened U.S.-China trade dispute.
Spot gold XAU= was up 0.3% at $1,530.20 per ounce as of
1309 GMT, after hitting its highest since April 2013, at
$1,554.56 earlier in the session.
U.S. gold futures GCcv1 were steady at $1,538.90.
"This is all about the trade tensions and the related risk
of global slowdown or even a global recession that is driving
investors to safe-havens," said Julius Baer analyst Carsten
Menke.
"There is doubt in markets about these trade talks, so
benefit of doubt or the leap of faith is not provided by
financial markets anymore when it comes to the trade topic,
which will be supportive for gold."
Washington announced last week an additional 5& duty on $550
billion in targeted Chinese goods, hours after China had
unveiled retaliatory tariffs on $75 billion worth of U.S.
products. However, offering limited respite and limiting gold's
advance, U.S. President Donald Trump on Monday said China had
contacted Washington overnight to say it wanted to return to the
negotiating table. "The thinking might be that there is a little bit more
positive sentiment now on the trade front, so people may be
taking some profits, there are too many longs in the gold
market," said Ronald Leung, chief dealer at Lee Cheong Gold
Dealers in Hong Kong.
While European stock markets recovered slightly following
Trump's comments, sentiment remained fragile with investors
scrambling into government bonds and whacking emerging market
currencies. MKTS/GLOB
Meanwhile, Federal Reserve Chairman Jerome Powell on Friday
said the U.S. central bank will "act as appropriate" to keep the
economy healthy, although he stopped short of committing to
rapid-fire rate cuts. The markets are fully priced for a quarter-point cut in
rates next month, and over 100 basis points of easing by the end
of next year. FEDWATCH
Lower interest rates decrease the opportunity cost of
holding non-yielding bullion and weigh on the dollar, making
gold cheaper for investors holding other currencies.
Reflecting increased investor interest in gold, holdings of
SPDR Gold Trust GLD , the world's largest gold-backed
exchange-traded fund, rose 0.6% to 859.83 tonnes on Friday.
GOL/ETF
Elsewhere, silver XAG= jumped 1.3% to $17.62 per ounce
after hitting its highest since September 2017 at $17.77 earlier
in the session.
Platinum XPT= rose 0.3% to $856 an ounce and palladium
XPD= climbed 1.1% to $1,477.