Gold falls on firmer dollar, US-China trade tension subside

April 28 (Reuters) - Gold prices eased on Monday as the thawing of trade tensions between the U.S. and China provided some relief to investors, while a stronger dollar further weighed on prices.

FUNDAMENTALS

* Spot gold XAU= fell 0.3% to $3,309.31 an ounce, as of 0016 GMT. Bullion hit a record high of $3,500.05 on April 22.

* U.S. gold futures GCcv1 gained 0.7% to $3,320.30.

* The U.S. dollar .DXY rose 0.2% against a basket of currencies, making bullion more expensive for overseas buyers.

* The Trump administration signalled openness last week to de-escalating a trade war between the world's two largest economies that has raised fears of recession. Trump has said talks on tariffs were taking place with China.

* On Friday, China exempted some U.S. imports from its steep tariffs in a sign that the trade war between the two countries could be easing, though China quickly knocked down U.S. President Donald Trump's assertion that negotiations were underway.

* Gold, traditionally seen as a hedge against economic and political uncertainties, thrives in a low interest rate environment.

* On the physical front, gold discounts in India jumped last week to the highest level in nearly nine years as record prices deterred buyers, while premiums in China rose to a more than one-year peak, leading to increased shipments to the world's largest bullion consumer.GOL/AS

* Among other metals, spot silver XAG= fell 0.6% to $32.87 an ounce, platinum XPT= eased 0.1% at $970.80 and palladium XPD= lost 0.6% to $942.71.

DATA/EVENTS (GMT)

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