* Liquidity thin in holiday-shortened week
* Australia, many European markets closed post-Christmas (Updates prices)
By A. Ananthalakshmi
SINGAPORE, Dec 28 (Reuters) - Gold slipped on Monday, tracking lower oil prices, but failed to get safe-haven bids despite weakness in the dollar and Asian equities as liquidity remained thin in a holiday-shortened week.
Spot gold XAU= eased 0.2 percent to $1,073.10 an ounce by 0702 GMT. Silver XAG= dropped nearly 1 percent to $14.21.
Oil prices fell after the long Christmas weekend, with international crude and product markets still well supplied in excess of demand. Gold is positively correlated to oil as the metal is seen as a hedge against petroleum-led inflation. O/R
The dollar index .DXY also fell, edging towards a two-month low hit earlier in the month. Asian stocks dipped amid a lack of immediate directional cues in light year-end trade. [MKTS/GLOB
Some markets, including Australia and many in Europe, will remain closed on Monday after Friday's Christmas holiday. Many markets will also be shut this coming Friday for New Year's Day.
"As it is a holiday shortened week, I don't think we would see much action. Having said that, we could see some sharp moves because of the paltry liquidity in markets," said a precious metals trader in Hong Kong.
"Early next year, gold should move lower as the dollar will remain strong in the first half of next year," he said. Any price moves will also be impacted by the pace of U.S. interest rate hikes, the trader said.
Higher rates would dent demand for non-interest-paying gold, while boosting the dollar.
Gold is set to close the year down about 9 percent, its third straight annual loss, largely in anticipation of the first U.S. rate hike in nearly a decade, which occurred this month.
Many traders and analysts expect gold to fall to $1,000 an ounce or even lower next year.
Assets in SPDR Gold Trust GLD , the world's top gold exchange traded fund, are near a seven-year low, reflecting bearish investor sentiment. GOL/ETF
PRICES AT 0702 GMT Metal
Last
Change Pct chg
Spot gold
1073.1
-2.4
-0.22 Spot silver
14.21
-0.13
-0.91 Spot platinum
880.5
-1
-0.11 Spot palladium
556
-2.45
-0.44 Comex gold
1072.6
-3.3
-0.31 Comex silver
14.21 -0.169
-1.18
COMEX gold and silver contracts show the most active months
(Editing by Tom Hogue and Biju Dwarakanath)