December 2, 2016 / 11:50 AM / 2 years ago

PRECIOUS-Gold rises despite U.S. jobs data but remains set for weekly loss

* SPDR gold holdings down 1.5 pct on Thursday
    * Gold bounced up from Thursday's 10-month low
    * Gold on track for fourth straight weekly loss
    * Palladium off 1-1/2-year high, down on the week

 (Updates prices; adds comment, second byline, NEW YORK
dateline)
    By Marcy Nicholson and Zandi Shabalala
    NEW YORK/LONDON, Dec 2 (Reuters) - Gold edged higher on
Friday, climbing for the first time in four sessions as it
shrugged off data showing rising U.S. job numbers, with analysts
saying that an expected rise in interest rates had already been
priced in.
    U.S. employers boosted hiring in November, pushing down the
unemployment rate to a more than nine-year low of 4.6 percent
and increasing the likelihood that the Federal Reserve will
raise interest rates this month. 
    Bullion is highly sensitive to rising interest rates, which
make the non-yielding asset less attractive while boosting the
dollar, in which it is priced.
    "The market is still thinking a December hike is very
likely, which has already factored in, and that's why gold is
not really moving today," said Natixis' precious metals analyst,
Bernard Dahdah.     
    Spot gold was up 0.3 percent at $1,174.03 an ounce by
2:33 p.m. EST (1933 GMT), bouncing up from Thursday's lowest
level since Feb. 5 at $1,160.38. It was on track to record a
fourth straight week of losses. 
    U.S. gold futures settled up 0.7 percent at
$1,177.80 per ounce. 
    Capital Economics commodities economist Simona Gambarini
said that U.S. president-elect Donald Trump is uppermost in
investors' minds.
    "Most investors are now looking at 2017 to see what's going
to happen with Trump, what policies he will implement and the
inflationary impact of those policies," Gambarini said.
    The dollar index, which measures the greenback
against a basket of major currencies, slipped by about 0.3
percent, helping to support gold prices. 
    "With a rate rise in a couple of weeks almost certain, the
dollar will remain firm and gold will remain pressured, although
we could see a bit of book-squaring in the run-up," said Marex
Spectron's head of precious metals, David Govett.
    Commerzbank said that it expects the upward trend of the
first half of the year to resume in 2017. 
    "The headwind from U.S. dollar appreciation and the rise of
bond yields should abate and investment demand should pick up
again also given the numerous risk factors," Commerzbank said.
    Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust, fell 1.5 percent on Thursday after
dropping more than 6 percent last month. 
    Silver rose 1 percent to $16.66 an ounce while
platinum was up 1.8 percent at $927.80.
    Palladium shed 1.5 percent at $739, and was on track
to close the week down for the first time in five weeks after
tumbling from Thursday's 1-1/2-year high. 

 (Additional reporting by Apeksha Nair in Bengaluru; Editing by
Susan Thomas and Lisa Shumaker)
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