* Palladium hits nine-year high of $787.25/oz

* Spot silver at three-week highs

* Coming up: U.S. weekly mortgage index; 1200 GMT

(Updates prices)

By Amanda Cooper

LONDON, Dec 29 (Reuters) - Gold steadied around two-week highs above $1,400 an ounce on Wednesday, closing in on a tenth consecutive yearly gain after another batch of U.S. data cast doubt on the economic outlook and weakened the dollar.

Palladium hit fresh nine-year highs, driven by expectations for robust demand next year, while silver hovered near three-week highs.

The latest U.S. data, which showed consumer confidence unexpectedly worsening in December and a drop in prices of single-family homes in October, was at odds with other signs suggesting recovery was accelerating in the world's largest economy.

Spot gold was a touch lower on the day at $1,403.22 an ounce by 1115 GMT, after hitting a two-week high of $1,406.75 on Tuesday. U.S. gold futures for February delivery were virtually unchanged on the day at $1,404.20.

"There is no significant data out today, so it's all relatively quiet and I think it will stay like that," said VTB Capital analyst Andrey Kryuchenkov.

"We're going to probably trade off currencies, the dollar index is still lower, that's supporting gold this morning."

Gold is on track for a near 30-percent gain this year, fuelled by investors seeking an alternative to increasingly volatile currencies, stocks and bonds, against a backdrop of an uncertain U.S. economic outlook and Europe's debt crisis.

U.S. 10-year Treasury yields were largely steady after their largest one-day rise in two weeks on Tuesday following a dismal auction of five-year debt.

DOLLAR STEADIES

The dollar stabilised somewhat after the rise in Treasury yields helped it recover from the previous day's losses. The dollar index was down a touch, having fallen in three out of the last five sessions.

"The U.S. economy outlook and monetary policy is a key factor that influences gold prices. We've seen data alternate between good and bad, showing that the economy is recovering, but without a strong momentum yet," said Hou Xinqiang, an analyst at Jinrui Futures based in China.

Hou expected gold prices to be rangebound with a strong support level at $1,360 in the short term, before they rally in the coming year.

Trading on the physical market was thin, with many market players sidelined over the holiday period, dealers said.

Spot silver hit a three-week high of $30.39 an ounce, and was trading at $30.32, led by a broad push higher across the commodities complex, with copper at record highs and crude oil steadying above $91 a barrel.

The gold-silver ratio, which reflects the number of ounces of silver needed to buy one ounce of gold, fell to a new four-year low of 46.6, compared with a 10-year average of 62.2.

Spot palladium reached $787.25, its highest since March 2001, before easing 0.4 percent on the day to $782.22.

Platinum was trading at $1,744.99, down 0.4 percent, but still near seven-week highs.

Analysts have had high hopes on the platinum group metals, citing robust growth in China's auto industry which is expected to boost consumption of the PGM, especially palladium, used to produce autocatalyst. (Additional reporting by Rujun Shen in Singapore; Editing by Alison Birrane)