Gold falls as 'positive' US-China talks erode safe-haven appeal

May 12 (Reuters) - Gold prices slipped on Monday as U.S.-China trade talks ended on a positive note, easing investor anxiety and denting demand for the safe-haven asset.

FUNDAMENTALS

Spot gold XAU= fell 1.1% to $3,286.86 an ounce as of 0014 GMT. U.S. gold futures GCcv1 lost 1.6% to $3,291.60.

The U.S. and China ended high-stakes trade talks on a positive note on Sunday, with U.S. officials touting a "deal" to reduce the U.S. trade deficit, while Chinese officials said they had reached "important consensus" and agreed to launch another new economic dialogue forum.

Chinese Vice Premier He Lifeng said a joint statement would be released in Geneva on Monday. Vice Commerce Minister Li Chenggang said it would contain "good news for the world."

The U.S. and China imposed tit-for-tat tariffs on each other last month, triggering a trade war that fuelled fears of a global recession.

America will be left with higher tariffs once the dust settles from U.S. President Donald Trump's trade negotiations, a majority of the current and former Trump advisers Reuters spoke to said.

On Friday, Cleveland Federal Reserve President Beth Hammack said the Fed needs more time to see how the economy responds to Trump's tariffs and other policies before figuring out the right response.

Last week, the Fed held interest rates steady and warned of rising inflation and unemployment risks.

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

Meanwhile, the Indian military sent a "hotline message" to Pakistan on Sunday about violations of a ceasefire agreed upon this week and informed it of New Delhi's intent to respond if it was repeated, a top Indian army officer said, while the Pakistan military's spokesman denied any ceasefire violations.

Spot silver XAG= eased 0.1% to $32.65 an ounce, platinum XPT= rose 0.4% to $998.65 and palladium XPD= firmed 0.5% to $980.41.