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PRECIOUS-Gold slips after strong U.S. jobs data boosts dollar

* U.S. election investigation underpins gold

* Platinum hits highest since late April

(Recasts, updates prices, adds quote/details) LONDON, Aug 4 (Reuters) - Gold fell on Friday after better than expected U.S. jobs data boosted the beleaguered dollar, clearing the way for the Federal Reserve to announce next month a plan to start shrinking its balance sheet. U.S. employer payrolls increased by 209,000 jobs last month amid broad gains across industries, data showed, while June's employment gain was also revised up to 231,000 from an already strong 222,000. The data also showed hourly earnings rose 0.3 percent in July. That was the biggest increase in five months and offered the Federal Reserve some assurance that inflation will gradually rise to its 2 percent target. The dollar, which was wallowing near 15-month lows prior to the figures, hit a four-day high after the release, making dollar-priced gold costlier for non-U.S investors. "The strong rise in non-farm payrolls together with the drop back in the unemployment rate to a joint 16-year low suggests the Fed will still need to raise rates again later this year, even if inflation remains subdued," said Simona Gambarini, commodities economist at Capital Economics. "In the absence of substantial geopolitical risks, we think that Fed tightening will prove too strong a headwind for gold prices this year. We expect the gold price to end the year at $1,150 per ounce."

Spot gold fell 0.5 percent to $1,262.09 an ounce by

1329 GMT, on track to end the week down 0.5 percent.

U.S. gold futures for December delivery fell 0.5

percent to $1,267.80 per ounce. Limiting losses in gold was escalating political turmoil in Washington which has cooled expectations for growth and inflation, and boosted safe haven assets like the precious metal. News broke late Thursday that U.S. special counsel Robert Mueller has impaneled a grand jury in Washington to investigate allegations of Russias interference in the 2016 presidential elections.

In other precious metals, silver fell 1.1 percent to

$16.43 per ounce, having hit a one week low of $16.39.

Platinum climbed 0.6 percent to $966.60 per ounce,

having earlier hit its highest since late April at $969.60,

while palladium dipped 0.1 percent to $882.80 per ounce.

(Additional reporting by Nithin Prasad and Arpan Varghese in Bengaluru; Editing by Greg Mahlich and Toby Davis)