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PRECIOUS-Gold up as dollar slips after weak U.S. jobs data

Published 06/09/2016, 01:05 am
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* Technical support at $1,315, resistance at $1,330

* Silver nears two-week highs touched in the previous session (Updates prices)

By Pratima Desai and Sethuraman N R

LONDON, Sept 5 (Reuters) - Gold rose on Monday as the dollar slipped on receding expectations of an imminent U.S. interest rate rise after lower than expected jobs numbers from the United States last week.

Spot gold XAU= was up 0.2 percent at $1,326.10 an ounce by 1500 GMT. The precious metal hit a one-week high above $1,341 on Friday after data showed U.S. employment growth slowed more than expected in August after two straight months of robust gains. gold futures GCcv1 were up 0.2 percent at $1,329.4.

"What we're seeing is a reversal of expectations that U.S. interest rates would rise in September," said ICBC Standard Bank analyst Tom Kendall. "The idea that monetary policy is going to stay super easy is good for gold."

The U.S. Federal Reserve's next policy meeting takes place Sept. 20-21 and a decision to keep policy on hold could mean a lower U.S. currency, making dollar-denominated gold cheaper and more attractive for non-U.S. buyers. FRX/

The U.S. Labour Day holiday is expected to keep volumes subdued on Monday, but new U.S. data releases and any speeches from Fed officials will be watched closely for clues to the timing of any rate moves.

JPMorgan (NYSE:JPM) analysts expect prices to average $1,425 an ounce in the first half of next year.

"Our bullish base case remains anchored to the fact that economic growth largely remains uninspiring while rates still remain very low or negative (especially on a real basis), something a 25 basis point rate hike in the U.S. in September or December will not wholly reverse," JPMorgan said in a note.

On technicals, analysts see strong support at $1,315, a 23.6 percent retracement of the August to September fall, with resistance at $1,330. and traders are also waiting to see whether physical demand picks up in India over the coming weeks because of festivals and the wedding season.

"This has been a disrupted year for gold demand in the Indian market ... it's going to take time for it to approach anything like normal," Kendall said.

Spot silver XAG= gained 0.4 percent to $19.4960 an ounce, having earlier touched a two-week high of $19.5150.

Platinum XPT= rose one percent to $1,069.25, while palladium XPD= added 0.3 percent to $675.50. (Additional reporting By Nallur Sethuraman in Bengaluru; Editing by David Goodman)

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