MON: PRECIOUS-Gold rises on weak U.S. dollar, holds near 3-week high
* Gold up on bargain hunting; watches dollar
* Premiums slip in HK, unchanged in Tokyo
* Coming Up; U.S. July unemployment trend index; 1400 GMT (Updates prices)
By Lewa Pardomuan
SINGAPORE, Aug 9 (Reuters) - Gold rose towards a three-week high on Monday as a weaker dollar and worries about the health of the U.S. economy spurred bargain hunting, but sales of scrap supplies were likely to cap gains.
The U.S. economy lost 131,000 jobs in July, boosting talk the Federal Reserve could consider further easing monetary policy -- a move that would strengthen gold's appeal as an investment.
Gold added $3.75 to $1,207.05 an ounce by 0539 GMT after rising as high as $1,212.61 on Friday, its highest since mid-July, on safe-haven buying driven by the dismal U.S. data and physical buying from jewellers and investors in Asia.
"I think people are waiting for the Fed's meeting tomorrow and an easing policy is most likely," said a dealer in Hong Kong.
"This is will be bad for the dollar and good for gold. But I think the market should consolidate before charging higher again. We need the investors to buy gold because I don't think the jewellers will continue to buy that much."
Jewellers cashed in on higher prices, cutting premiums for gold bars to as low as 70 cents to the spot London prices in Hong Kong from $1.50 last week.
"The premiums have dropped back to the lower levels, which are related to the price moving higher," said Dick Poon, manager of Heraeus in Hong Kong. "There's a slowdown in physical demand."
Although gold had slipped below the 50-day moving average, it still hovered above the 25 and 100-day moving averages. Bullion was about 5 percent below a lifetime high struck in June.
U.S. gold futures for December delivery rose $4.8 an ounce to $1,210.1.
The U.S. dollar fell against emerging Asian currencies on growing expectations the Fed will have to buy more bonds to support the flagging economy, helping to also lift commodity prices and equities. [MKTS/GLOB]
The market was closed in Singapore for a National Day holiday, while the physical market was also slow in Tokyo because of the absence of demand from jewellers and the industrial sector.
"Many companies are shut for the summer holidays. Things are very quiet and the premiums are unchanged at 50 cents," said a dealer in Tokyo.
Oil prices hovered just below $81 a barrel on Monday, as a weaker dollar supported prices that had fallen for three straight days last week, in part on poor U.S. economic data. [O/R] Precious metals prices at 0539 GMT Metal Last Change Pct chg YTD pct chg Turnover Spot Gold 1207.05 3.75 +0.31 10.16 Spot Silver 18.48 0.07 +0.38 9.80 Spot Platinum 1556.75 -6.50 -0.42 6.12 Spot Palladium 485.70 1.65 +0.34 19.78 TOCOM Gold 3330.00 4.00 +0.12 2.18 23987 TOCOM Platinum 4322.00 -52.00 -1.19 -1.35 14361 TOCOM Silver 51.60 0.00 +0.00 -0.19 244 TOCOM Palladium 1351.00 -22.00 -1.60 15.97 137 Euro/Dollar 1.3279 Dollar/Yen 85.52 TOCOM prices in yen per gram. Spot prices in $ per ounce. (Editing by Ed Lane)
