* Prices pressured by dollar; upbeat PMI data boosts currency
* Gold on course for weekly loss, snapping two weeks of gains
By Josephine Mason and Mariana Ionova
NEW YORK/LONDON, Oct 23 (Reuters) - Gold was flat to slightly lower on Friday as the dollar soared to its highest level in more than two months and U.S. equities raced higher after China eased monetary policy for the sixth time in a year, reviving expectations of a U.S. rate hike.
Bullion vaulted over 1 percent higher to an intraday high of $1,180 per ounce in early New York trading immediately after Beijing announced a surprise interest rate cut.
Investors initially bet the Federal Reserve would be compelled to delay raising rates given the fragility of the global economy, but buying soon evaporated on the view that the Chinese stimulus and upbeat U.S. data made a U.S. rate hike more likely this year.
Gains in U.S. equities also reduced the appeal of safe-haven bullion and bonds, while the U.S. dollar rose to its highest mark since Aug. 19 against a basket of currencies, further pressuring bullion. .DXY . MKTS/GLOB
"The effect of the Chinese rate cut faded with breathtaking alacrity," said Tai Wong, director of base and precious metals trading for BMO Capital Markets in New York.
"The surge in U.S. shares and yields backing up as a result weighed on metals and once gold slipped back below $1,170, day traders liquidated and we didn't find decent support until $1,160."
Spot gold XAU= eased 0.03 percent to $1,166.3 an ounce at 3:05 p.m. EDT (1905 GMT). U.S. gold futures GCcv1 settled down 0.3 percent at $1,162.8. Bullion was on course for a weekly loss, snapping two weeks of gains.
Gold has languished at 5-1/2-year lows in recent months on expectations the Fed will raise rates this year, potentially lifting the opportunity cost of holding non-yielding bullion.
Concerns over the health of the global economy have recently pushed back expectations into 2016. But further stimulus in China and upbeat U.S. data have increased the likelihood of a rate rise in December.
Better-than-expected manufacturing figures for October supported the dollar. U.S. flash manufacturing PMI rose to its highest level since March, beating expectations for a slight decline from the previous month. USMPMP=ECI
A stronger dollar weighs on gold by making the metal more expensive for holders of other currencies.
Friday's slide deepened losses from the previous session, when gold fell to its weakest point since Oct. 13. The metal was on course to lose 1.2 percent this week, snapping two weeks of gains.
Silver XAG= was up 0.32 percent at $15.90 an ounce, platinum XPT= dipped 0.85 percent to $1,007.20 per ounce and palladium XPD= gained 1.4 percent to $695.25 per ounce. (Editing by David Clarke, David Evans and Paul Simao)