PRECIOUS-Gold up as U.S. job growth disappoints, but posts weekly loss

Fri Sep 6, 2013 3:23pm EDT

* U.S. payrolls rise by less than expected in August
    * Gold down 0.5 pct for week as fears ease over Syria
    * Top Fed policymaker says tapering to start September
    * Coming up: US consumer credit Monday

 (Adds trader comment, second byline, dateline, updates market
activity)
    By Jan Harvey and Clara Denina 
    NEW YORK/LONDON, Sept 6 (Reuters) - Gold rose 1.5 percent on
Friday after weaker-than-expected U.S. nonfarm payrolls
increased confusions over when the Federal Reserve will start
paring back its massive bond-buying stimulus.
    Despite Friday's rally, gold ended the week 0.5 percent
lower for a second consecutive weekly loss as its safe-haven
appeal dropped on a lack of progress about possible U.S.
military strikes against Syria.
    Bullion jumped as much as $30 or 2 percent after data showed
U.S. employers hired fewer workers than expected in August and
the jobless rate hit a 4-1/2 year low as Americans gave up the
search for work. 
    The disappointing report complicates the Fed's decision on
whether to scale back its monetary stimulus later this month, as
the U.S. central bank is set to deliver its next policy
statement on Sept. 18. 
    "There is a lot of uncertainty with Syria and the Fed
tapering. Those two forces are very much on most traders' minds
right now," said Albert Ng, a market maker and portfolio manager
at Aurum Options Strategies in New York. 
    U.S. President Barack Obama resisted pressure on Friday to
abandon plans for air strikes against Syria and enlisted the
support of 10 fellow leaders for a "strong" response to a
chemical weapons attack. 
    Spot gold was up 1.5 percent to $1,387.46 an ounce by
2:43 p.m. EDT (1843 GMT).
    U.S. Comex gold futures for December delivery settled
up $13.50 at $1,386.50 an ounce, with volume about 10 percent
below its 30-day average, preliminary Reuters data showed.
    The worse-than-expected U.S. jobs data suggests that
tapering of the Fed's $85 billion monthly bond-purchases, known
as quantitative easing, could be pushed back further than had
previously been expected, said Mitsui Precious Metals analyst
David Jollie.
    The Fed should begin reducing monthly bond purchases at a
meeting later this month in order to set monetary policy on a
course for "gradual and predictable" normalization,  Kansas City
Fed President Esther George, a top U.S. central banker, said on
Friday. 
    Monetary stimulus has been a major driver of gold's rally of
recent years, as the metal's status as a hedge against inflation
and economic uncertainty benefited from increased money printing
by central banks in a low interest-rate environment.
    Gold rose to a record high of $1,920.30 on Sept. 6, 2011 -
exactly two years ago. Year-to-date, the metal is down 17
percent and may be set to break its streak of annual gains in
the past 12 consecutive years.
    Among other precious metals, silver was up 2.8
percent at $23.80 an ounce. Platinum gained 0.9 percent
to $1,491.74 an ounce, while palladium was up 1.3 percent
at $693.71 an ounce.

 2:43 PM EDT     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold DEC   1386.50  13.50   1.0  1358.80 1393.60  150,666
 US Silver DEC  23.891  0.636   2.7   23.075  23.990   38,350
 US Plat OCT   1495.70  13.60   0.9  1478.30 1506.00    8,685
 US Pall DEC    696.85   9.65   1.4   685.35  705.25    3,713
                                                              
 Gold          1387.46  20.47   1.5  1363.35 1392.46         
 Silver         23.800  0.650   2.8   23.080  23.910
 Platinum      1491.74  12.74   0.9  1481.00 1502.50
 Palladium      693.71   9.21   1.3   687.52  701.75
                                                              
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold        160,326   173,377   184,596     24.76   -0.09
 US Silver       40,078    70,632    58,418      37.7    0.32
 US Platinum      9,550     9,983    12,297     20.37    0.00
 US Palladium     3,772     6,904     5,806                  
                                                              
 
 (Additional reporting by Clara Denina in London; Editing by
William Hardy, Keiron Henderson and Nick Zieminski)