Metals

Gold firms above 3-1/2 month low from US jobs data

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Gold was steady 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.

was steady at $1,167 an ounce by 0053 GMT. The metal fell to $1,156.85 on Thursday, its lowest since mid-March, but pared some losses after U.S. economic data.

For the week, bullion is still down 0.7 percent, its second straight weekly loss.

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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.

Before the data release, there had been strong expectation in markets 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.

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Bullion, which has been under pressure all year from uncertainty over a rate hike, pared losses overnight after the jobs data and as the U.S. dollar index fell from a three-week high.

Higher rates would boost the dollar but weaken demand for non-interest-paying bullion.

SPDR Gold Trust, the top gold-backed exchange-traded fund, said its holdings fell 0.25 percent to 709.65 tonnes on Thursday.

The market was also following developments in the Greek debt crisis, which has so far failed to trigger strong safe-haven bids for the metal. The focus in the Greek crisis is on Sunday's referendum.

The International Monetary Fund delivered a stark warning on Thursday of the huge financial hole facing Greece as angry and uncertain voters prepare for a referendum that could decide their country's future in Europe.

U.S. markets will be closed on Friday in observance of Independence Day.