Gold near three week low

SINGAPORE, Dec 24 (Reuters): Gold was trading close to a three-week low on Wednesday as strong US economic growth boosted equities and the dollar, weakening safe-haven bids for bullion.

Data on Tuesday showed the US economy grew at a 5.0 per cent clip in the third quarter, its quickest pace in 11 years and the strongest sign yet that growth has decisively shifted into higher gear.

Both the Dow and the S&P 500 hit record closing highs on Tuesday after the GDP report, with Asian stocks following their lead on Wednesday. The dollar index climbed to its highest in nearly nine years.

Stronger equities and the dollar reduce demand for bullion,  often seen as an alternative investment to riskier assets. The robust data could also prompt the Federal Reserve to raise interest rates soon, a factor that would hurt non-interest-bearing gold.    

Spot gold ticked up slightly to $1,179.20 an ounce by 0717 GMT, but close to a three-week low of $1,170.17 hit on Monday. Any dip below that level could trigger further losses.

"Markets are likely to trade quietly ahead of the Christmas holidays," said Jason Cerisola, a metals dealer at MKS Group.

 "$1,170 continues to be the key level on the downside, with market chatter of large stop loss orders sitting below."

Thin liquidity due to the Christmas holiday could also exaggerate any price moves.