PRECIOUS-Gold dips after promising China data; set for weekly rise

    * Gold hovers below Thursday's 1-month peak
    * China factory gate prices rise by most in nearly 3 years
    * Palladium faces biggest weekly decline in six weeks

 (Adds comments; updates prices)
    By Diptendu Lahiri
    April 9 (Reuters) - Gold prices fell on Friday as robust
economic data from China boosted hopes of a swift recovery,
though bullion was set to rise more than 1% on the week as the
U.S. dollar and Treasury yields pulled back from recent highs.
    China's March factory gate prices rose at their fastest
annual pace since July 2018, beating estimates.             
    Spot gold        fell 0.4% to $1,748.81 per ounce at 0655
GMT, having hit its highest since March 1 at $1,758.45 an ounce
on Thursday. U.S. gold futures        slipped 0.5% to $1,748.70
per ounce.
    "Gold is facing some headwinds due to optimism around the
recovery story as a result of strong data that has been coming
out of the United States and China," said Ravindra Rao, vice
president, commodities at Kotak Securities.
    Still, the metal has gained nearly 1.2% this week, after two
weeks of losses.
     "The (falling) dollar and Treasury yields have helped gold
this week along with the Fed's dovish tone, that has been topped
with lockdowns in Europe and parts of Asia with some negative
vaccine results," said Brian Lan, managing director at dealer
GoldSilver Central.                          
    Recent robust economic data, driven by massive stimulus
measures, has dulled safe-haven demand for bullion. 
    Federal Reserve Chair Jerome Powell on Thursday signalled
the central bank is nowhere near to reducing its support for the
U.S. economy and cautioned that the anticipated price increase
this year is likely to be temporary.              
    "The likely rise in inflation in April could support gold
prices in the coming weeks, especially if it rises faster than
bond yields. In the more medium term, the rise in bond yields is
likely to put renewed pressure on gold," Fitch Solutions said in
a note.
    Silver        eased 0.8% to $25.23 and platinum        was
down 1.2%, at $1,214.67.
    Palladium        rose 0.2% to $2,630.11, but was on track
for its biggest weekly fall since week ending Feb. 26.

 (Reporting by Diptendu Lahiri and Swati Verma in Bengaluru;
Editing by Uttaresh.V, Amy Caren Daniel and Shailesh Kuber)