* Gold steadies after recouping losses * Weak U.S. dollar brings out buyers * Role as an inflation hedge dulls (Updates prices, adds details, analyst comment) SYDNEY, Dec 5 (Reuters) - Gold steadied after recovering lost ground in Asian trading on Friday, supported by the European Central Bank's bigger-than-expected interest rate cut, which pressured the U.S. dollar lower and prompted bullion buying. The gains, while modest, counter emerging anti-inflationary signs that typically erode bullion's investment appeal as a protector of wealth during periods of financial uncertainty. Spot gold was fetching $767.30 a ounce by 0158 GMT even with New York's late Thursday price. Gold was finding buyers due to the weaker U.S. currency, which was falling against the euro as some investors lauded a bolder-than-expected rate cut of 0.75 percentage points by the European Central Bank as a proactive step to fight off a deep recession in the 15-nation region, bullion dealers said. However, gold's appeal as a hedge against inflation suffered a setback after the broad-based commodity index Reuters/Jefferies CRB .CRB dropped overnight to a six-year low, led by a 6 percent fall in crude oil futures. After peaking at $830.99 last week, gold has retreated to around $770, which is 28 percent below bullion's all-time high of $1,030.80 hit in March. "This follows a period of low volatility and consolidation for the metal as prices traced out a small triangle reversal pattern," Sydney research group Fat Prophets said. "Following the initial break higher, we were looking for a short-term target of $858, however, a period of choppy consolidation between $750 and $840 is now a more likely outcome," it said in a report. U.S. gold futures for February delivery GCG9 rebounded in electronic trade to $768.80 an ounce after settling down $5.00 at $765.50, on the COMEX division of the New York Mercantile Exchange. Australia dollar gold was fetching A$1,193.07 an ounce versus A$1,186.95 late on Thursday. Australia dollar gold hit a record high of A$1,41.30 on Oct 8. Spot platinum was selling for $790.00 an ounce against $786.50 late on Thursday. Spot palladium was fetching $167.00 an ounce versus $166.50, while spot silver gained 1 cent to $9.47 an ounce. (Reporting by James Regan; Editing by Clarence Fernandez) Precious metals prices at 0153 GMT Metal Last Change Pct chg YTD pct chg Turnover Spot Gold 767.70 2.00 +0.26 -7.81 Spot Silver 9.48 0.02 +0.21 -35.82 Spot Platinum 789.50 3.00 +0.38 -48.06 Spot Palladium 170.00 3.50 +2.10 -53.80 TOCOM Gold 2279.00 -12.00 -0.52 -25.52 11777 TOCOM Platinum 2365.00 -39.00 -1.62 -55.70 4393 TOCOM Silver 279.20 -0.70 -0.25 -48.39 113 TOCOM Palladium 518.00 -11.00 -2.08 -61.66 165 Euro/Dollar 1.2753 Dollar/Yen 92.47 TOCOM prices in yen per gram, except TOCOM silver which is priced in yen per 10 grams. Spot prices in $ per ounce. (Editing by Clarence Fernandez)

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