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PRECIOUS-Gold hits 2-mth low as dollar gains ahead of U.S. jobs data

* Spot gold set for 4th straight weekly decline

* U.S. nonfarm payrolls due at 1230 GMT

* Spot gold may slide to $1,260/oz - technicals

(Adds comment, updates prices) Oct 6 (Reuters) - Gold hit its lowest in nearly two months in range-bound trade on Friday, as the dollar climbed to a more than seven-week high ahead of key U.S. jobs data later in the day.

Spot gold was unchanged at $1,267.71 an ounce at 0705

GMT, after hitting its lowest since Aug. 9 earlier in the session. It was down 0.9 percent for the week and headed for a fourth straight weekly decline.

U.S. gold futures for December delivery were down

0.2 percent at $1,270 per ounce. "The dollar is strong. That is one reason why gold is rangebound. Markets are expected to hold this way until nonfarm payrolls is out. We might see some action only then," said Brian Lan, managing director at dealer GoldSilver Central in Singapore. Asian shares rose, tracking Wall Street gains, and the dollar touched an over seven-week high against a basket of

currencies on fresh signs of economic growth and hopes

for progress on U.S. tax reforms, with traders looking to U.S. jobs data for near-term catalysts.

"Investors will be casting a keen eye on tonight's non-farm payroll data release, given the relative strength in equities and the dollar, a strong NFP reading could have gold testing the 200 DMA level at $1252," MKS PAMP said in a note. The U.S. employment data for September is expected to show a slowdown due to the impact of Hurricane Harvey and Irma. "The rebound of the dollar has been quite strong and may need to pause," said Samson Li, an analyst with Thomson Reuters GFMS. "Even if the dollar index may break over 94, further upside is probably limited, and a consolidation (softer dollar) will likely follow, before strengthening again towards the end of Nov/start of Dec when the market is expecting another rate hike." Markets are largely expecting the U.S. Federal Reserve to raise interest rates for the third time this year, in December.

The Fed will need to raise rates further to keep the economy on track to full employment and the central bank's 2 percent inflation goal, Kansas City Fed President Esther George said on Thursday. Gold is highly sensitive to rising rates, as these lift the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced. Spot gold may slide to $1,260 per ounce as it has broken a support at $1,270, according to Reuters technicals analyst Wang Tao.

In other precious metals, silver was flat at $16.58

an ounce.

Platinum edged up 0.2 percent to $913 an ounce, while palladium eased 0.1 percent to $938 an ounce.

(Reporting by Apeksha Nair and Arpan Varghese in Bengaluru; Editing by Gopakumar Warrier and Subhranshu Sahu)