PRECIOUS-Gold hits over 1-month low; palladium races past platinum

    * Dollar rises on hawkish Fed, strong data
    * Silver hits lowest since Aug. 16
    * GRAPHIC-Platinum/palladium ratio:

 (Recasts, adds comments, updates prices)
    By Nithin ThomasPrasad
    Sept 28 (Reuters) - Gold fell to over one-month lows on
Thursday as the dollar rose on expectations of a U.S interest
rate hike in December, while platinum was trading at a discount
to palladium for the first time since 2001.
    Spot gold        was down 0.2 percent at $1,278.36 per ounce
at 0607 GMT, after hitting its lowest since Aug. 16 earlier in
the session, as strong U.S economic data took sheen off the
yellow metal.
    U.S. gold futures         for December delivery fell 0.5
percent to $1,281.30.
    "In the near term, we're still looking at interest rates for
direction," said Ronald Leung, chief dealer at Lee Cheong Gold
Dealers in Hong Kong.
    "Unless North Korea does something, I think gold will be
under pressure."
    In the latest development on North Korea, France's foreign
minister on Wednesday urged U.S. President Donald Trump to focus
on raising diplomatic pressure on Pyongyang.                 
    The dollar and U.S. bond yields rose after President Trump
proposed the biggest U.S. tax overhaul in three decades and as
strong economic data added to the case for a rate hike by the
Federal Reserve later this
    A stronger dollar makes bullion more expensive for holders
of other currencies, while higher interest rates lead to higher
bond yields and dampen demand for non-yielding gold.  
    In other metals, platinum        dipped 0.1 percent, to
$914.85 per ounce after hitting its lowest since July 20, while
palladium        eased 0.4 percent to $922.60.   
    "In the long run, we believe palladium and platinum could
trade at similar levels. The strength of palladium this year is
due to the strong performance of the Chinese auto sector. Sales
have been better than expected," said Samson Li, an analyst with
Thomson Reuters-owned metals consultancy GFMS.
    "Palladium is like a growth stock while platinum is like a
value stock now."  
    Palladium hit price parity with platinum on Wednesday for
the first time since 2001.             
    Platinum is more heavily used in diesel vehicles that have
fallen out of favour since 2015's Volkswagen emissions-rigging
    Palladium has benefitted from the switch to petrol engines
and expectations for growth in hybrid electric vehicles, which
tend to be gasoline-powered.
    However, the percentage of electric vehicles is still too
low and therefore the impact is not likely to be felt in the
next two-to-three years, Li said, adding that palladium is
expected to remain supported in 2017 by the Chinese auto market.
    Silver        fell 0.3 percent to $16.69 per ounce, after
dropping to $16.64, its lowest since Aug. 16.

 (Reporting by Arpan Varghese and Nithin Prasad in Bengaluru;
Editing by Richard Pullin and Vyas Mohan)