(New throughout, adds comments and updates prices)
* France delays easing virus restrictions due to Delta variant
* Gold prices still in a downtrend, analyst says
July 1 (Reuters) - Gold edged up on Thursday as a more than 7% slide in June prompted some traders to buy the metal amid concerns over the Delta variant of the coronavirus, but moves were capped by caution over Friday’s U.S. payrolls data and a strong dollar.
Spot gold was up 0.2% to $1,773.09 per ounce by 2:22 pm EDT (1822 GMT), while U.S. gold futures settled up 0.3% at $1,776.80.
Gold posted its biggest monthly loss since November 2016 in June, hurt by a surprise hawkish shift by the U.S. Federal Reserve. Higher interest rates tend to translate into a higher opportunity cost of holding non-yielding gold.
But some investors bought gold as a safe-haven as the Delta variant of the coronavirus spread, analysts said, with France delaying the easing of restrictions in the Landes region.
Focus is now on Friday’s nonfarm payrolls report for clues on the timeline of the U.S. monetary policy shift, after Federal Reserve officials suggested the central bank should ease asset purchases this year. A Reuters poll forecast a gain of 690,000 jobs this month.
Initial jobless claims dropped more than expected last week.
“(Gold) prices are in a downtrend and the bears have the overall near-term technical advantage,” said Jim Wyckoff, senior analyst with Kitco Metals, attributing gold’s uptick on Thursday to bargain hunting after it dropped to a more than two month low on Wednesday.
“For gold to turn a corner, you’re going to have see multiple closes above $1,800,” Wyckoff added.
Gold’s advance was also kept in check by a firm dollar.
Peter McGinn, senior market strategist at RJO Futures said that gold might need a big selloff in equity markets in order to make another push higher.
Elsewhere, silver fell 0.5% to $25.98 per ounce, palladium dropped 0.5% to $2,764.66, and platinum rose 0.8% to $1,081.30. (Reporting by Nakul Iyer in Bengaluru; Editing by Kirsten Donovan)
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