(Updates prices)
* Palladium slides after hitting 1-month high on Wednesday
* Focus on U.S. initial jobless claims data due at 1230 GMT
* For an interactive graphic tracking the global coronavirus spread, open https://tmsnrt.rs/3aIRuz7 in an external browser
By Brijesh Patel
May 21 (Reuters) - Gold slipped 1% on Thursday, pulling away from this week's 7-1/2 year peak as the U.S. dollar strengthened and hopes for a quick economic recovery dented bullion's safe-haven appeal.
Spot gold XAU= was down 0.7% at $1,736.64 per ounce at 1203 GMT. U.S. gold futures GCv1 fell 0.8% to $1,738.30 per ounce.
The dollar index .DXY , which compares the U.S. currency with a basket of rivals, rose 0.3%, making gold more expensive for holders of other currencies. USD/
"Gold seems to have lost a little momentum since breaking above $1,750, and the rise in the dollar today doesn't seem to be helping," OANDA analyst Craig Erlam said.
"However, the enormous amount of monetary stimulus in the system, the need for that to continue for some time and the inflation risk are all bullish for gold in the longer term."
Gold prices climbed to their highest since October 2012 at $1,764.55 earlier this week, mainly driven by monetary and fiscal stimulus, recession fears, and U.S.-China tensions.
U.S. Federal Reserve policymakers acknowledged the possibility of further support measures if the economic downturn persists, the minutes from their latest policy meeting showed. focus now shifts to initial U.S. jobless claims data due later in on Thursday for further clues about the health of the world's biggest economy.
The devastating impact of the coronavirus pandemic on the euro zone economy has abated a little this month as some governments eased lockdowns, a survey showed. yellow metal remains locked within a $40 range ($1,760-$1,720) and should continue to find solid interest toward the lower end over the near term," MKS PAMP said in a note.
Among other precious metals, palladium XPD= dropped 1.8% to $2,063.86 an ounce after hitting a one-month high on Wednesday. Platinum XPT= shed 1.1% to $841.37.
Silver XAG= dipped 1.6% to $17.22 an ounce.