* Gold firms as dollar dips after U.S. nonfarm payrolls
* Metal still headed for weekly drop of 0.6 pct
* U.S. markets shut on Friday, focus on Greek referendum (Updates prices)
By A. Ananthalakshmi
SINGAPORE, July 3 (Reuters) - Gold ticked up above a 3-1/2 month low on Friday, as sluggish U.S. jobs data tempered expectations for a September rate hike by the Federal Reserve and hurt the dollar.
Spot gold XAU= gained 0.2 percent to $1,168.26 an ounce by 0243 GMT. The metal fell to $1,156.85 on Thursday, its lowest since mid-March, but pared losses after U.S. economic data.
For the week, bullion is still down 0.6 percent, its second straight weekly loss, due to gains in the dollar earlier in the week from the Greek debt crisis.
"The soft U.S. employment data has helped gold for the moment but I don't see much more upside here unless the dollar drops sharply," said a precious metal trader in Hong Kong.
"Liquidity will likely be thin today with the U.S. markets out, so the next trigger could be Sunday's referendum in Greece," the trader said.
U.S. markets will be closed on Friday in observance of Independence Day.
Data on Thursday showed nonfarm payrolls rose 223,000 last month, below expectations. Payrolls growth in April and May was also revised downwards. At least 432,000 people dropped out of the labour force. ID:nL1N0ZI0OH
Before the data, there had been strong expectations that the Fed would raise interest rates for the first time in nearly a decade in September, given recent strong data on consumer spending and housing.
But the softer-than-expected jobs data prompted investors to lower their bets for a September rate hike. The U.S. dollar index .DXY fell from a three-week high. USD/
Gold has been under pressure all year from uncertainty over the timing of a rate hike as higher rates could dent demand for non-interest-paying bullion and boost the dollar.
SPDR Gold Trust, the top gold-backed exchange-traded fund, said its holdings fell 0.25 percent to 709.65 tonnes on Thursday, not too far from a near-six-year low hit last month.
Despite Thursday's losses, the greenback is on track for a second straight weekly gain as the Greek debt crisis hurt the euro, capping gains in bullion.
Athens defaulted on a loan repayment to the International Monetary Fund this week. Greece's left-wing government called a referendum for Sunday after five months of acrimonious talks with its official creditors over an aid-for-reforms deal broke down without a deal.
The crisis could drive more risk-averse money into gold if Greece leaves the euro zone, or if contagion reaches other economies in the bloc, such as Italy, Portugal or Spain, traders said. ID:nL8N0ZG3U8
PRICES AT 0243 GMT Metal
Last
Change Pct chg
Spot gold
1168.26
2.51
0.22 Spot silver
15.65
-0.04
-0.25 Spot platinum
1079
-1.95
-0.18 Spot palladium
689.65
-2.6
-0.38 Comex gold
1167.5
4
0.34 Comex silver
15.63
0.068
0.44 Euro
1.1092
DXY
96.053
COMEX gold and silver contracts show the most active months