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PRECIOUS-Gold dips as investors await Powell speech

* Fed Chair to discuss policy at 1300 GMT

* Interactive graphic tracking global spread of coronavirus: open tmsnrt.rs/3aIRuz7 in an external browser (Updates prices)

Aug 27 (Reuters) - Gold fell on Thursday as investors reassessed their positions, booked profits after a more than 1% jump in the previous session and anticipated fresh stimulus announcements from U.S. Federal Reserve Chairman Jerome Powell.

Spot gold was down 0.7% at $1,940.77 per ounce by 1138 GMT, after rising 1.3% on Wednesday. U.S. gold futures were down 0.2% to $1,949.30 per ounce.

Powell is scheduled to discuss the Fed’s annual conference of central banks at 1310 GMT, with investors watching for inflation and monetary policy clues.

“Gold has rallied for quite some time now and the expectation of more stimulus packages are increasing the possibilities of an economic recovery,” said OANDA analyst Craig Erlam.

The Fed has cut interest rates to near zero and introduced unparalleled measures to stimulate the coronavirus-hit economy, contributing to gold’s 28% rise this year.

Carsten Menke, analyst at Julius Baer, said gold prices might see only “momentary volatility” when Powell speaks.

“Cutting interest rates further doesn’t look seem to be on the plate. What investors are expecting is more stimulus packages.”

Lower interest rates minimise the opportunity cost of owning non-yielding bullion and weigh on the dollar, rendering gold cheaper for buyers transacting in other currencies.

Gold also benefits as a perceived hedge against possible inflation and currency debasement triggered by the money-printing by global central banks to ease the economic blow from the pandemic.

The metal’s latest retreat came despite a cautious mood in European equity markets ahead of the Fed’s Jackson Hole virtual conference.

Elsewhere, silver was down 0.8% to $27.29 per ounce, palladium was off nearly 1% at $2,176.30 and platinum was up 0.4% to $932.88 per ounce. (Reporting by Diptendu Lahiri and Brijesh Patel in Bengaluru; editing by Barbara Lewis and Jason Neely)

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