PRECIOUS-Gold hovers at $1,030/oz, ETF holdings dip for 3rd day

* Gold correcting from run-up that began in Sept, eyes dlr

* SPDR Gold holdings fall 1.22 tonnes on Wed [GOL/SPDR]

By Risa Maeda

TOKYO, Oct 29 (Reuters) - Gold prices steadied around $1,030
per ounce on Thursday, pausing their decline for now after
earlier hitting a new three-week low of $1,025.75, but the
topside was capped by a recovery in the U.S. dollar.

An extended fall in higher-yielding currencies as well as in
stocks, partly reflecting fears over the pace of economic
recovery, suggested investors kept unwinding growth-linked
trades that had been in vogue in recent months.

"A run-up in gold after the Labour Day holiday (on Sept. 7)
has been way overdone," said Kaname Gokon, deputy general
manager in the research section of Japanese commodity broker
Okato Shoji Co.

"That needs to be corrected until a floor is found at
$990-$1,000," Gokon said, referring to the level bullion stood at
in the second week of September.

That floor could be touched before U.S. monthly job report
data due early next month, he added.

The precious metal had been taking buying cues from
fast-growing optimism over economic recovery, which fuelled
inflation concerns. A steadily declining dollar also increased
the allure of the precious metal as an alternative asset.

Spot gold XAU= edged up to $1,031.60 by 0240 GMT, up 0.5
percent from New York's notional close of $1,026.85.

Technically the $1,025-$1,030 level has been considered as a
short-term floor as it provided a long-standing ceiling that
gold passed through earlier this month.

Bullion was down more than 3 percent from a record high
above $1,070 hit on Oct. 14.

U.S. gold futures for December delivery GCZ9 traded at
$1,032.10 per ounce after falling $4.90, or 0.5 percent, to
$1,030.50 on Wednesday.

In the foreign exchange market, the U.S. dollar held firm
near its highest in more than two weeks against a basket of
currencies .DXY, pulling further away from a 14-month low
marked on Oct. 21. [USD/]

Investor appetite for bullion stayed low, with the world's
largest gold-backed exchange-traded fund reporting a third
consecutive daily outflow. [GOL/SPDR]

SPDR Gold Trust (GLD) said its holdings stood at 1,104.434
tonnes as of Oct 28, down 1.22 tonnes or 0.1 percent from the
previous business day and bringing the total decline this week
to 3.66 tonnes.

Among other precious metals, spot silver XAG= rose to
$16.21 per ounce, off a new three-week low of $16.08 marked
earlier on Thursday. Platinum XPT= clawed above $1,300 to
$1,308.50 per ounce after touching a new three-week low of
$1,297.00 on Wednesday.

Precious metals prices at 0232 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1031.65 4.80 +0.47 17.21
Spot Silver 16.20 0.11 +0.68 43.11
Spot Platinum 1311.00 7.50 +0.58 40.67
Spot Palladium 317.00 3.50 +1.12 71.82
TOCOM Gold 3012.00 -51.00 -1.67 17.06 63611
TOCOM Platinum 3826.00 -53.00 -1.37 44.27 11385
TOCOM Silver 473.20 -16.30 -3.33 48.20 606
TOCOM Palladium 926.00 -35.00 -3.64 68.36 446
Euro/Dollar 1.4705
Dollar/Yen 90.42
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Joseph Radford)