PRECIOUS-Gold dips as U.S yields firm; focus shifts to U.S. inflation data

* U.S. CPI data, ECB meeting on Thursday

* Medium to longer term outlook positive for gold - analysts (Adds comments, updates prices)

June 7 (Reuters) - Gold eased on Monday as U.S. Treasury yields firmed slightly, while investors awaited key inflation readings that could offer clues on the Federal Reserve’s monetary policy going forward.

Spot gold was down 0.2% at $1,885.42 per ounce by 1215 GMT, while U.S. gold futures eased 0.2% to $1,887.60.

Yields on U.S. 10-year notes were a touch higher after sliding 7 basis points on Friday, curbing interest in non-yielding gold. The dollar meanwhile held steady against a basket of currencies.

While firmer bond yields are weighing on gold prices, the metal has a good chance of rising back above $1,900 an ounce as the environment continues to be constructive for bullion, Commerzbank analyst Eugen Weinberg said.

Prices rose more than 1% on Friday after a weaker-than-expected U.S. monthly jobs report calmed investor fears about the Fed reining in monetary stimulus in the near future.

“Gold continues to enjoy stronger tailwinds than headwinds, with many real interest rates around the world firmly in negative territory and continued geopolitical risk,” StoneX analyst Rhona O’Connell said in a note.

Lower interest rates decrease the opportunity cost of holding non-yielding gold. It is also considered a hedge against inflation, which could follow stimulus measures.

Inflation will remain in focus this week, with the latest U.S. consumer price index report due on Thursday. Central bank meetings are also scheduled in Europe and Canada.

U.S. Treasury Secretary Janet Yellen said on Sunday President Joe Biden’s $4 trillion spending plan would be good for the United States even if it contributes to rising inflation and results in higher interest rates, Bloomberg News reported.

Longer to medium term, “we might see more volatility on equity markets, which will be increasing the value of gold as a safe haven (and) as inflation protection”, Commerzbank’s Weinberg said. Silver dipped 0.8% to $27.56 per ounce, palladium was down 0.4% at $2,832.63, and platinum rose 0.3% to $1,165.51. (Reporting by Nishara Karuvalli Pathikkal and Arundhati Sarkar in Bengaluru; Editing by Simon Cameron-Moorea and Jan Harvey)