PRECIOUS-Gold gains for fourth day as dollar slips on weak U.S. data

    * Dollar index        marks lowest since November
    * Spot gold may rise more to $1,245 per ounce- technicals
    * Platinum hovers near two-week highs touched Monday

 (Updates prices)
    By Vijaykumar Vedala
    May 16 (Reuters) - Gold prices rose for a fourth day on
Tuesday as the dollar slid on signs of slower economic activity
in the United States that dented expectations of an aggressive
string of interest rate hikes by the U.S. Federal Reserve.
    The New York Federal Reserve bank said on Monday its Empire
State Manufacturing Activity index, a report on business
activity in the state, unexpectedly fell in May, sinking into
negative territory for the first time since October. The
weaker-than-expected report could be a harbinger a possible
deterioration in the U.S. manufacturing sector.             
    Spot gold        was up 0.4 percent at $1,234.81 per ounce
at 0731 GMT. On Monday, it hit $1,237.26, its highest since May
    U.S. gold futures         gained 0.4 percent to $1,234.90 an
    "In the shorter term it (weaker U.S. data) could lift gold
prices to a certain extent as it ensures the pace of the
interest rate hikes do not accelerate," said Mark To, head of
research at Hong Kong's Wing Fung Financial Group.
    Expectations of a U.S. rate increase in June fell to 74
percent compared to 84 percent last week, according to the CME
    Higher interest rates tend to boost the dollar        and
push bond yields up, putting pressure on gold prices by
increasing the opportunity cost of holding non-yielding bullion.
    Risk aversion sentiment due to recent global developments
including the North Korean missile test, the massive
"ransomware" cyber attack and controversies surrounding U.S.
President Donald Trump could lift gold prices over the next two
weeks, Wing Fung's To added.                                    
    Gold is used as an alternative investment during times of
political and financial uncertainty.
    Spot gold may rise more to $1,245 per ounce, as it has
cleared a resistance at $1,233, according to Reuters technical
analyst Wang Tao.             
    Paulson & Co held its stake steady in the world's biggest
gold exchange-traded fund while Soros Fund Management stayed out
of the precious metal in the first quarter of 2017, when bullion
prices rallied to 3-1/2-month highs, a filing showed on Monday.
    The dollar index        slipped 0.4 percent, to its lowest
since early November versus a basket of major currencies.   
    Among other precious metals, silver        rose 0.7 percent
to $16.71 an ounce. 
    "Although there is increasing evidence of a bottom being
formed in both gold and silver, we would like to see a bit more
"staying power" before choosing to engage more aggressively on
the long side," INTL FCStone analyst Edward Meir said.
    Platinum        held near a two-week high hit on Monday,
climbed 0.7 percent to $934.25 per ounce. 
    Producers, fabricators and traders have gathered for the
Platinum Week in London.                                     
    Palladium        gained 0.6 percent to $801 an ounce.

 (Reporting by Vijaykumar Vedala in Bengaluru; Editing by
Christian Schmollinger and Sherry Jacob-Phillips)