* Silver on track for best month since June 2016
* Platinum set to post biggest monthly gain since January 2018
* Palladium on track for second straight monthly decline (Adds comments, updates prices)
By K. Sathya Narayanan
Aug 30 (Reuters) - Gold erased early losses to trade slightly higher on Friday and was headed for its biggest monthly gain in over three years as concerns about a slowdown in global growth and hopes for rate cuts by central banks worldwide boosted safe-haven bids.
Spot gold had gained 0.2% to $1,530.60 per ounce by 0637 GMT and was set for a more than 8% gain for the month, its biggest since June 2016.
U.S. gold futures were up 0.3% at $1,540.80.
“This is only a technical bounce. People have really considered that bullion is a safe-haven... And are using every dip as buying opportunity,” said Vandana Bharti, assistant vice-president of commodity research at SMC Comtrade.
Gold slipped as much as 0.4% earlier in the session after a near 1% drop in the previous session, as positive developments around the Sino-U.S. trade negotiations rekindled investor appetite for riskier assets.
U.S. Treasury yields rose on Thursday, with 30-year yields climbing from record lows, while Asian equities jumped to a one-week high on Friday.
“Last night’s (Sino-U.S.) trade war news resulted in gains in stock markets... We saw yields climb very marginally in bond markets overnights, and that prompted a little bit of a flurry of risk taking and a selloff in gold,” said IG Markets analyst Kyle Rodda.
U.S. President Donald Trump said some trade discussions were taking place on Thursday, with more talks scheduled.
China’s commerce ministry said a September round of meetings was being discussed by the two sides, but added that it was important for Washington to cancel a tariff increase.
“Gold prices remain pretty well supported because the risks in the trade war haven’t changed and the outlook on the global economy hasn’t changed pretty much. That means there are still bets on major interest rate cuts from global central banks,” Rodda added.
Federal funds futures implied traders saw a 96% chance of a 25 basis-point rate cut by the U.S. central bank next month.
Spot silver gained 0.8% to $18.39 per ounce, after matching a high last seen in April 2017 on Thursday. It was set to post its biggest monthly gain since June 2016.
Platinum rose 1% to $925 an ounce, after touching its highest since April 2018 in the previous session. It was up over 7% so far this month, en route its biggest monthly gain since January 2018.
Palladium gained 0.9% to $1,487.15 per ounce, but was set for a second straight monthly decline. (Reporting by K. Sathya Narayanan in Bengaluru; editing by Richard Pullin and Subhranshu Sahu)