* Dollar pulls back after post-U.S. election rally
* Outflows from gold exchange-traded funds weigh
* Palladium touches six-week low at $652.80/oz
* GRAPHIC-2016 metal returns: tmsnrt.rs/2eqHKkL
(Updates prices; adds comment, second byline, NEW YORK
By Marcy Nicholson and Jan Harvey
NEW YORK/LONDON, Dec 21 Gold was little changed
but held above last week's 10-1/2-month low on Wednesday as a
retreat in the dollar from the previous session's 14-year peak
prompted some buyers to hunt bargains after the metal's sharp
slide from its November high.
Bullion gave up earlier gains as the greenback came
off session lows against a basket of six major currencies, while
stocks edged down.
The metal had been hit hard by a surge in the dollar after
the Nov.8 U.S. elections, and a more hawkish tone from the U.S.
Federal Reserve after it hiked interest rates last week for only
the second time in about a decade last month.
Spot gold was down 0.06 percent at $1,131.11 an ounce
by 2:30 p.m. ET (1930 GMT), after trading as high as $1,137.12.
U.S. gold futures for February delivery settled down 0.04
percent at $1,133.20 per ounce.
Gold is getting some support from moves in the wider
markets, Commerzbank analyst Carsten Fritsch said. "The U.S.
dollar is slightly weaker and U.S. bond yields are slightly
lower as well," he said.
The Fed last week signaled three more rate increases next
year. Gold is highly sensitive to rising U.S. interest rates,
which lift the opportunity cost of holding non-yielding bullion,
while boosting the dollar, in which it is priced.
"Looking ahead, we think that there is a risk that the price
of gold might fall further in the coming months as the Fed hikes
rates more aggressively in response to some of Trump's more
inflationary policies," Capital Economics said in a note.
"That said, we see gold recovering over the medium term, as
demand for inflation hedges picks up and ongoing geopolitical
uncertainty ensures that safe havens remain well supported."
Hefty outflows from gold-backed exchange-traded funds of
late have been pressuring gold, HSBC said in a note.
"Declines of 300,000 ounces reported Monday night are the
latest in more than a month of consecutive gold ETF outflows,"
it said. "The GLD, the world's largest gold ETF, has fallen 13
percent to 26.6 million ounces since the U.S. November
Among other precious metals, palladium was down 1.05
percent at $657 an ounce, after touching a six-week low of
$652.80. It remains the best performing precious metal this
quarter, with a drop of just 9 percent, compared with a 14
percent drop in the price of gold and an 11 percent retreat in
Spot silver was down 0.9 percent at $15.93, while
platinum was 0.1 percent lower at $914.80.
(Additional reporting by Swati Verma and Nallur Sethuraman in
Bengaluru; Editing by Louise Heavens and Paul Simao)