* Fed officials suggest bond purchases will continue for longer Friday's nonfarm payroll data will be key for price direction
(Adds analyst's quotes, updates prices) SINGAPORE, Nov 5 (Reuters) - Gold snapped a six-session losing streak on Tuesday, aided by comments from U.S. Federal Reserve officials that suggested the central bank will support the economy and financial markets for some more time. The metal, however, was still trading in a narrow range as investors refrained from taking any big positions ahead of a crucial U.S. jobs report later this week. The Fed said last month that it would stick with its $85 billion monthly bond purchases until the economy improves further and budget issues in Washington are resolved, raising expectations that the tapering would not begin until next year. But its language was interpreted as being more hawkish than earlier, which raised the possibility it could still scale back the purchases this year. The Fed should scale back its asset purchases only when the U.S. economy shows clearer signs of improvement and even then it should act slowly, one senior central banker said on Monday, while two others stressed there is no need to rush.
"The Fed is less likely to cut back stimulus this year due to the recent government shutdown and lacklustre economic data," said Chen Min, a precious metals analyst at Jinrui Futures in Shenzhen. "We hold that the Fed will start scaling back in the first quarter of next year and therefore remain bearish on gold prices." Spot gold was up 0.23 percent at $1,317.34 an ounce The metal has lost about a fifth of its value this year on fears of a stimulus tapering and outflows from gold-backed exchange traded funds. A strong U.S. nonfarm payrolls report on Friday would rekindle fears about the Fed's stimulus tapering from December and further pressure gold prices. Dollar-denominated gold was also supported by a slightly stronger euro on Tuesday. The euro clung to modest gains, having bounced off a seven-week low on the back of improving euro zone data, but talk of a rate cut this week should curb demand for the common currency. "Should the euro weakness resume, bullion prices may fall back onto the defensive and test $1,300 per ounce," HSBC analysts said in a note. A fall below $1,300 could provide a boost to physical demand that has been subdued lately.
Precious metals prices 0313 GMT
Metal Last Change Pct chg YTD pct chg Volume Spot Gold 1317.34 2.98 +0.23 -21.33 Spot Silver 21.67 0.03 +0.14 -28.43 Spot Platinum 1454.49 4.75 +0.33 -5.24 Spot Palladium 745.50 -1.00 -0.13 7.73 COMEX GOLD DEC3 1317.60 2.90 +0.22 -21.37 3964 COMEX SILVER DEC3 21.72 0.02 +0.09 -28.33 1638 Euro/Dollar 1.3505 Dollar/Yen 98.32
COMEX gold and silver contracts show the most active months
(Editing by Ed Davies and Muralikumar Anantharaman)