TOKYO, Sep 18 Gold edged down on Tuesday on profit taking after reaching a 16-month high

TOKYO, Sep 18 (Reuters) Gold edged down on Tuesday on profit taking after reaching a 16-month high the previous day, while Tokyo Commodity Exchange gold futures rallied to an eight-week high.

-- By 0055 GMT, spot gold was trading at $715.00/715.80 an ounce, down from $716.80/717.60 late in New York on Monday when it rose as high as $719.65 -- the highest since May 15, 2006.

-- Investors bought gold on Monday on expectations the U.S.

Federal Reserve will cut interest rates, which may lift bullion's appeal.

-- The Fed is widely expected to trim its benchmark interest rate by at least 25 basis points on Tuesday to help cushion the economy from the impact of the credit squeeze and housing slump. Lower interest rates tend to make the dollar less attractive and often boost gold's safe-haven appeal.

-- TOCOM precious metals rose across the board, reflecting sharp gains made during the Japanese public holiday on Monday.

The benchmark August 2008 TOCOM gold contract hit a session peak of 2,672 yen a gram -- the highest for any benchmark since July 24.

August TOCOM gold was up 38 yen or 1.4 percent from Friday's close of 2,634 yen.

-- Platinum inched down to $1,296/1,301 an ounce from $1,298.30/1,305.30 in New York on Monday.

-- Palladium was little changed $329/334 an ounce from $328.75/332.75 in New York.

-- Silver edged down to $12.74/12.79 an ounce from $12.75/12.80 late in New York.

Precious metals prices at 0055 GMT Metal Last Change Pct chg YTD pct chg Turnover Spot Gold 715.00 -2.40 -0.33 12.47 Spot Silver 12.74 -0.02 -0.16 -0.86 Spot Platinum 1298.00 -0.30 -0.02 14.66 Spot Palladium 329.00 0.25 +0.08 -0.90 TOCOM Gold 2671.00 37.00 +1.40 9.24 28553 TOCOM Platinum 4786.00 39.00 +0.82 12.51 7998 TOCOM Silver 474.40 10.10 +2.18 -3.83 429 TOCOM Palladium 1237.00 -6.00 -0.48 -1.43 19 Euro/Dollar 1.3870 Dollar/Yen 115.00 TOCOM prices in yen per gram, except for silver which is in yen per 10 grams, spot prices in $ per ounce.

REUTERS RC BST0720