PRECIOUS-Gold eases from one-month high as Fed rate hike looms

    * U.S. consumer spending, inflation data support Fed hike
    * Political uncertainty in Europe stokes safe-haven buying
    * Spot gold, silver touch one-month peaks
    * GRAPHIC-2017 asset returns:

 (Recasts; adds comments, U.S. economic data, updates prices)
    By Devika  Krishna Kumar and Zandi Shabalala
    NEW YORK/LONDON, May 30 (Reuters) - Gold prices eased after
hitting a one month high on Tuesday as economic data from the
United States showed increased signs that the Federal Reserve
would raise interest rates next month.
    U.S. consumer spending recorded its biggest increase in four
months in April and monthly inflation rebounded, pointing to
firming domestic demand that could allow the Federal Reserve to
raise interest rates next month.             
    The metal, often seen as an alternative investment during
times of political and financial uncertainty, earlier in the
session touched a one-month high as it benefited from a
risk-averse mood in global markets along with the Japanese yen
and U.S. Treasuries.
    Spot gold        touched a one-month high of $1,270.47
before pulling back 0.3 percent to $1,262.76 per ounce by 2:15
p.m. EDT (1815 GMT). U.S. gold futures         slipped to end
the session 0.5 percent lower at $1,262.1 an ounce.
    "While U.S. inflation data released May 30 (broadly in line
with expectations) and the U.S. employment report is due on 2
June are where the market will be looking for guidance on the
Fed's monetary policy, price risks in both directions could
arise from the UK election (June 8) and the FOMC meeting (June
14)," Standard Chartered analysts said in a note. 
    "Our economists continue to expect a 25 (basis points)
Federal Reserve hike in June while the market is pricing in an
84 percent probability of such a hike."
    Gold is highly sensitive to higher rates, which increase the
opportunity cost of holding non-yielding bullion while boosting
the dollar, in which it is priced. 
    Investors have been concerned about next week's election in
Britain, as well as the prospect of early elections in Italy and
worries over Greek debt, which analysts said supported gold and
dented stocks.            
    A poll in Britain on Tuesday showed Prime Minister Theresa
May's lead over the opposition Labour Party dropping to six
percentage points ahead of the election on June 8.             
    "Ideally to see a rally in the (stock) markets the UK would
want to see Theresa May win by an overwhelming majority which
seems to be less likely to happen taking into account the latest
polls," Natixis precious metals analyst Bernard Dahdah said.
    "If May wins with her current lead it will be slightly
negative for her negotiation hand (in Brexit talks) and ...
positive for gold."
    In Italy, former prime minister Matteo Renzi suggested on
Sunday that the country's next election be held at the same time
as Germany's. Germany will vote on Sept. 24, while elections are
due in Italy by May 2018.             
    Euro zone finance ministers' failure to agree on Greek debt
relief with the International Monetary Fund last week also added
to risk aversion.         market analyst Fawad Razaqzada said the focus for
bullion this week was U.S. non-farm payrolls due on Friday.
    "I expect the dollar to continue to strengthen this week
until Friday's jobs data release, therefore I think gold is
going to go down from here," Razaqzada said.
    Among other precious metals, silver        marked its
highest level since April 27 at $17.47 an ounce. It was last
down 0.12 percent at $17.35.
    Palladium        was up 0.91 percent at $804.25 after
hitting the highest since May 16 at $807.70 an ounce. Platinum
       was down 1.24 percent at $940.70 an ounce.

 (Additional reporting by Nithin ThomasPrasad and Vijaykumar
Vedala in Bengaluru; editing by Jane Merriman and Chizu