PRECIOUS-Gold retreats as ECB policy statement knocks euro

    * Euro slips as ECB reaffirms ultra-loose policy stance
    * SPDR Gold Trust holdings fall to lowest since early Feb
    * GRAPHIC-2017 asset returns:

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    By Jan Harvey
    LONDON, July 20 (Reuters) - Gold fell on Thursday as the
European Central Bank's reaffirmation of its ultra-easy policy
stance pushed the euro lower against the dollar, although moves
were muted before a news conference by ECB chief Mario Draghi. 
    The ECB kept rates at record lows and confirmed its
asset-buying programme would continue at 60 billion euros
($69.15 billion) per month at least until December and could be
expanded or extended if deemed necessary.             
    The euro extended losses to slip 0.3 percent against the
dollar after the policy decision, retreating further from a
recent a 14-month high. A stronger dollar tends to pressure
assets priced in the U.S. currency.       
    Spot gold        was down 0.3 percent at $1,236.89 an ounce
at 1209 GMT, while U.S. gold futures         for August delivery
were 0.5 percent lower at $1,236.30 an ounce.
    "It is the dollar factor which is having an influence on the
gold price," ThinkMarkets chief market analyst Naeem Aslam said.
"Investors will react if there are any surprises from Draghi in
his speech, (but) we do not expect any."
    The maintenance of loose monetary policy in the euro zone
could be seen as either positive or negative for gold, depending
on whether the metal responds positively to a persistently low
opportunity cost of holding the non-yielding metal or more
negatively to a weaker euro.
    The ultra-low interest rates in place since the last
decade's global financial crisis have been a key factor
supporting gold prices in recent years.
    With the end to that unprecedented stimulus now within
sight, financial investors are nervously trying to gauge how big
central banks around the globe will unwind unconventional
policies that have kept borrowing costs ultra low.
    Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Shares      , fell 5.3 tonnes on Wednesday to
816.1 tonnes, their lowest since early February. Its reserves
have declined more than 12 tonnes so far this week.
    "In terms of investment demand, the physically backed
products have seen outflows recently rather than inflows, so
there hasn't been much support from that side," Julius Baer
analyst Carsten Menke said. 
    Among other precious metals, silver        was down 0.2
percent to $16.20 an ounce after touching its highest in over
two weeks at $16.36 in the previous session.
    Platinum        was 0.4 percent lower at $914.70 an ounce,
while palladium        was down 0.6 percent at $850.97 an ounce.
It hit a three-week high of $872.25 an ounce on Wednesday.

 (Reporting by Jan Harvey; additional reporing by Nithin Prasad
and Arpan Varghese in Bengaluru; Editing by Elaine Hardcastle
and Edmund Blair)