Sept 13 (Reuters) - Gold prices were little changed on
Friday, on track for a third weekly decline as optimism over the
U.S.-China trade talk fanned risk sentiment, while palladium
hovered around a record peak on concerns about tight supplies of
the autocatalyst metal.
FUNDAMENTALS
* Spot gold XAU= was trading flat at $1,497.81 per ounce,
as of 0105 GMT. Prices have dropped about 0.6% so far this week,
poised for a third consecutive weekly decline.
* U.S. gold futures GCv1 dropped 0.1% to $1,505.50.
* Palladium hit a record peak of $1,621.55 on Thursday on
concerns over tight supplies due to possible labour issues in
South African mines. * The metal XPD= dropped 0.5% to $1,609.85 in early trade.
* Hopes of progressing trade talks kept risk appetite up,
after U.S. President Donald Trump said on Thursday he preferred
a comprehensive trade deal with China but did not rule out the
possibility of an interim pact, even as he said an "easy"
agreement would not be possible. * The two sides have been making conciliatory gestures ahead
of the talks, lowering the temperature between them and cheering
investors.
* Asian equities rose, with MSCI's broadest index of
Asia-Pacific shares outside Japan .MIAPJ0000PUS up 0.2%,
weighing on safe-haven gold. MKTS/GLOB
* Elsewhere, European Central Bank chief Mario Draghi
pledged indefinite stimulus on Thursday to revive an ailing euro
zone economy. * The bigger-than-expected stimulus will increase pressure
on the U.S. Federal Reserve and Bank of Japan to ease policy
next week to support a world economy increasingly characterised
by low growth and protectionist threats to free trade.
* Meanwhile, U.S. underlying consumer prices increased
solidly in August, leading to the largest annual gain in a
year. * The World Gold Council (WGC) on Thursday published a set
of guidelines for gold miners, responding to rising pressure
from consumers, NGOs and governments to ensure the gold market
is free from criminality, rights abuses and benefits local
communities. * In Hong Kong, long-running and sometimes violent street
protests are helping tarnish its lustre as the main physical
gateway of gold to China, the world's top bullion buyer.