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PRECIOUS-Gold gains on stimulus hopes, muted dollar after Brexit deal

 (Recasts, adds comments, updates prices)
    * Markets shrug-off Trump threat around aid bill
    * Britain and the EU strike a post-Brexit trade deal
    * Interactive graphic tracking global spread of coronavirus:
tmsnrt.rs/3mvcUoa

    By Shreyansi Singh
    Dec 24 (Reuters) - Gold prices rose in holiday-thinned trade
on Thursday as investors remained optimistic over U.S. stimulus
and the dollar was mostly lower after Britain clinched a trade
deal with the European Union.
    Spot gold        rose 0.4% to $1,878.77 per ounce by 1:42
p.m. EST (1842 GMT). U.S. gold futures        settled up 0.3% at
$1,883.20.
    "Although there have been setbacks in the stimulus
negotiations there is a high likelihood of stimulus passing at
some point relatively soon and that is somewhat supporting gold
prices to an extent," said Jeffrey Sica, founder of Circle
Squared Alternative Investments.
    "However, one of the reasons why we are not seeing a bigger
move up is because there is significant volatility but upside
momentum in the stock market."            
    Investors largely brushed off reports that U.S. lawmakers
blocked attempts to alter a $2.3 trillion coronavirus aid and
government spending package.                          
    Gold, which has risen about 24% this year, tends to benefit
from widespread stimulus measures because it is widely viewed as
a hedge against inflation and currency debasement.
    "Supportive factors for the gold market include the weaker
U.S. dollar index for the past couple of days after gains
earlier this week," said Kitco Metals senior analyst Jim
Wyckoff.
    Raising gold's appeal for holders of other currencies, the
U.S. dollar was muted after Britain clinched a narrow Brexit
trade deal with the European Union.                   
    Meanwhile, worries over the spread of a more transmissible
coronavirus variant have led to a tightening of restrictions in
Britain, underlining concerns over a post-pandemic economic
recovery.             
    Among other precious metals, silver        was up 1% at
$25.79. Platinum        gained 0.7% to $1,022.08 and palladium
       rose 0.8% to $2,341.20.
    Trading is expected to be subdued ahead of the Christmas
holidays.

 (Reporting by Shreyansi Singh and Aaron Saldanha in Bengaluru;
Editing by Pravin Char and Chizu Nomiyama)
  
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