Gold up on risk-averse sentiment ahead of Trump-Xi meeting

(Reuters) - Gold prices edged up on Thursday on a weaker dollar and as appetite for risky assets such as equities waned ahead of a tense meeting between U.S. President Donald Trump and his Chinese counterpart.

FUNDAMENTALS

* Spot gold rose 0.1 percent to $1,256 per ounce by 0100 GMT. U.S. gold futures climbed as much as 1 percent to $1,260.80 and was last up 0.7 percent at $1,257.

* On Tuesday, spot gold hit its highest since Feb. 27 at $1,261.15.

* Investors were cautious ahead of a potentially tense meeting between Trump and Chinese President Xi Jinping on Thursday, the first between the world's two most powerful leaders.

* Topping the agenda at Trump's Mar-a-Lago resort in Florida will be whether he makes good on his threat to use U.S.-China trade ties to pressure Beijing to do more to rein in its nuclear-armed neighbour North Korea.

* Lingering fears of a possible trade war kept Asian markets on edge.

* The dollar index fell 0.1 percent to 100.450.

* U.S. Federal Reserve's March minutes on Wednesday showed most policymakers think the central bank should take steps to begin trimming its $4.5 trillion balance sheet later this year as long as the economic data holds up.

* The ADP National Employment Report showed that U.S. private employers added 263,000 jobs in March, beating economists' forecasts of 187,000 additions.

* Euro zone businesses enjoyed their best quarter in six years at the start of 2017 and although growth was not quite as fast as a flash estimate, the upturn was broad-based, a survey suggested on Wednesday.

* Greece and its international lenders remained at odds in talks to release fresh bailout loans to Athens on Wednesday as Prime Minister Alexis Tsipras said a deal was needed this week and accused creditors of 'playing games' and causing delays.

* China's Shandong Gold Mining Co Ltd is in advanced talks to buy a 50 percent stake in Barrick Gold Corp's Veladero gold mine in Argentina, people familiar with the process told Reuters even as the Canadian miner grappled with a pipe rupture at the site.

* ABN AMRO said on Wednesday it sees 2017 average gold price forecast at $1,254 per ounce and the 2017 average silver price forecast at $18.3 per ounce.

* UBS on Wednesday tempered its gold price expectations. It expects gold to average $1,300 per ounce for 2017 from $1,350 previously and $1,325 for 2018 from $1,450 previously.

DATA AHEAD (GMT)

0145 China Caixin services PMI Mar

0600 Germany Industrial orders Feb

1130 U.S. Challenger layoffs Mar

1230 U.S. Weekly jobless claims

(Reporting By Nallur Sethuraman in Bengaluru; Editing by Biju Dwarakanath)