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US dollar up 0.4%

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Fed's Cook will file lawsuit to keep job, lawyer says

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Focus on US PCE data due on Friday

(Updates for EMEA midday session)

By Ishaan Arora

Aug 27 (Reuters) - Gold slipped on Wednesday as the

dollar firmed and investors booked profits after prices hit a

more than two-week high in the previous session.

Spot gold was down 0.5% at $3,375.79 per ounce at

1119 GMT. U.S. gold futures for December delivery eased

0.2% to $3,425.10.

The dollar index, which measures the greenback

against a basket of major currencies, rose about 0.4%, making

dollar-priced bullion more expensive for other currency holders.

"(Gold) prices are acting less like an arrow and more like a

feather, with the prevailing direction of travel determined by

the dollar. Current gold price weakness is likely attributable

to some profit-taking...as momentum faded to the upside,"

independent analyst Ross Norman said.

Bullion hit its highest since August 11 on Tuesday after

U.S. President Donald Trump's attempt to fire Fed Governor Lisa

Cook undermined confidence in the independence of the central

bank and more broadly in U.S. assets, boosting safe-haven

demand.

Cook will file a lawsuit to prevent Trump from firing her,

her lawyer said, kicking off what could be a protracted legal

fight over the White House's effort to shape U.S. monetary

policy.

"Market participants will await the decision of U.S. courts

(regarding whether) Trump can fire Cook or not, before gold

reacts more strongly," UBS analyst Giovanni Staunovo added.

The data focus is on the Fed's preferred inflation gauge,

the Personal Consumption Expenditures Price Index, due on

Friday, after dovish remarks from Fed Chair Jerome Powell at the

Jackson Hole symposium last week.

Markets have priced in an 87% chance of a quarter-point rate

cut at the Fed's September 17 policy meeting, according to the

CME FedWatch Tool.

Non-yielding gold typically performs well in a

low-interest-rate environment.

Spot silver fell 0.8% to $38.27 per ounce, platinum

was also down 0.8% at $1,337.38 and palladium was

0.2% lower at $1,091.99.