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PRECIOUS-Gold gains on weaker dollar, U.S. stimulus bets

    * Silver could rally to $40/oz over next 12 months- Citi
    * Pelosi optimistic of U.S. fiscal aid before elections
    * Interactive graphic tracking global spread of coronavirus:
open
tmsnrt.rs/3aIRuz7 in an external browser

 (Updates prices)
    By Brijesh Patel
    Oct 19 (Reuters) - Gold climbed on Monday as a softer dollar
and optimism over a new U.S. stimulus agreement before next
month's presidential election lifted demand for bullion as an
inflation hedge.
    Spot gold        was up 0.7% at $1,912.22 per ounce by 1147
GMT. U.S. gold futures        rose 0.5% to $1,916.
    The dollar        slipped 0.2% versus rivals, making gold
less expensive for holders of other currencies.       
    "The continued focus on the potential for a stimulus package
being agreed to and introduced before the Nov. 3 election is
continuing to impact gold," said Saxo Bank analyst Ole Hansen.
    "It seems like both parties are still, at least on paper, in
discussion and keeping the door open for a deal to be reached...
That's probably the key source of inspiration to a market that I
would say in general has gone a bit stale."
    U.S. House Speaker Nancy Pelosi said on Sunday that
differences remained with the Trump administration on a
wide-ranging relief package but that she was optimistic
legislation could be pushed through before Election Day.
            
    Gold, which has gained over 26% so far this year, tends to
benefit from stimulus spending because it's considered a hedge
against inflation risks and currency debasement. 
    "We expect gold to trade cautiously around $1,900 level for
now, the game changer being whether we can get (U.S) fiscal
stimulus in the next 48 hours," said Howie Lee, economist at
OCBC Bank.
    Concerns around fresh coronavirus-led restrictions in Europe
and elsewhere also bolstered gold's safe-haven appeal.
            
    Elsewhere, silver        climbed 2.7% to $24.82, having hit
a near one-week peak.
    Citi said in a note it expects silver to rally to $40 over
the next 12 months, on sustained investor demand and a recovery
in industrial consumption in 2021.             
    Platinum        gained 1.7% to $874.50 per ounce and
palladium        rose 0.8% to $2,349.17.

 (Reporting by Brijesh Patel in Bengaluru; editing by Emelia
Sithole-Matarise and Andrew Heavens)
  
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