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PRECIOUS-Gold up for 2nd day on Chinese data renews growth concerns

* Gold rises for 2nd day, silver gains more ground
    * Precious metals seen up as interest rate increase unlikely

 (Updates prices)
    By Naveen Thukral
    SINGAPORE, May 16 (Reuters) - Gold rose for a second session
on Monday, as slowing economic growth in China and weakness in
Asian stock markets lifted the safe-haven appeal of the precious
metal. 
    Spot gold gained 0.6 percent to $1,281.40 an ounce by
0729 GMT, while U.S. gold futures added 0.8 percent to
$1,282.90 an ounce.
    "In the second quarter, $1,300 to $1,400 is a fairly
reasonable price for gold as the central banks are not going to
raise interest rate any time soon," said Mark To, head of
research at Wing Fung Financial Group in Hong Kong. "I think
overall sentiment is very positive for the gold market."
    China's investment, factory output and retail sales all grew
more slowly than expected in April, adding to doubts about
whether the world's second-largest economy is stabilising, data
released on Saturday showed. 
    Gold has gained around 20 percent this year after weak
economic data in the United States and elsewhere eased
expectations of a near-term increase in U.S. interest rates.
    Higher rates would lift the opportunity cost of holding
non-yielding gold.
    Still, stronger-than-expected U.S. economic data last week
renewed expectations the Federal Reserve will hike rates more
than once this year, capping gains in precious metals.
    U.S. retail sales in April recorded their biggest increase
in a year as Americans stepped up purchases of automobiles and a
range of other goods, suggesting the economy was regaining
momentum after growth almost stalled in the first quarter.
 
    Two Fed officials said the central bank should raise rates
if data points to an improving economy.  
    Among other precious metals, spot silver advanced 1.4
percent to $17.240 an ounce, platinum was up 0.8 percent
at $1,056.20 while palladium rose 0.8 percent to $593.97.

 (Reporting by Naveen Thukral; Editing by Himani Sarkar and
Sherry Jacob-Phillips)
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