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RTRS: PRECIOUS-Gold firms on weak dollar, soft U.S. jobs data
 
By Rujun Shen
SINGAPORE, June 6 (Reuters) - Gold strengthened on Monday,
extending gains made in the previous session, as a disappointing
U.S. jobs data fueled fears of a slowdown in recovery of the
world's biggest economy and a softer dollar lent support.
U.S. employers hired the fewest number of workers in eight
months in May and unemployment rate rose to 9.1 percent, stoking
worries that the economic growth may be faltering, supporting
sentiment in gold which is seen as a safe-haven investment
during economic uncertainties. [ID:nOAT004818]
"The weak U.S. data has increased the possibility of a third
round of quantitative easing," said Ong Yi Ling, an analyst at
Phillip Futures.
"I think it is premature to say we will see a third round.
But if the Fed (U.S. Federal Reserve) signals that there may be,
it will be the catalyst pushing gold to $1,550 and beyond."
Spot gold edged up 0.3 percent to $1,545.75 an ounce
by 0607 GMT, building on three consecutive weeks of gains.
U.S. gold GCcv1 gained 0.3 percent to $1,547.40.
Trading was thin as markets in China, Hong Kong and South
Korea were shut on a public holiday, traders said.
When the Fed announced the second round of quantitative
easing, known as the QE2, in November last year, gold prices
scored record highs for four consecutive sessions.
Before any clear clue on further quantitative easing, gold
is likely to be trapped in the range between $1,520 to $1,550,
traders said.
Technical analysis also indicated that spot gold faced
resistance at $1,553 an ounce, Reuters market analyst Wang Tao
said. [ID:nL3E7H6049]
The U.S. dollar was stuck near a one-month low hit
against a basket of major currencies in early Asia trade,
finding no support after the disappointing jobs data bolstered
expectations that U.S. interest rates will stay low for longer.

The weakness in the dollar is likely to buoy prices of
commodities, as a soft dollar makes commodities cheaper for
holders of other currencies.

Investors also continued to watch the ongoing Greek debt
crisis for trading cues. International lenders said on Friday
that the country was likely to get a vital slice of aid in July
to avoid default while the European Union raised the prospect of
expanding the bailout of the euro zone state.[ID:nLDE7520MP]
Spot silver rose 1.5 percent to $36.75 in thin
holiday trade, after dropping to a 1-1/2 week low of $35.13 in
the previous session.
Silver prices were nearly 26 percent lower than its record
high of $49.51 hit on April 28, but still up 19 percent on the
year, compared to gold's 9-percent rise.
The price drop has attracted some investors. Money managers
raised their bullish bets in gold and silver last week, U.S.
regulator data showed Friday. [ID:nN03176967]
"We have seen some short covering," said a Singapore-based
trader, "Generally the market will probably be buying metals on
dips after the payrolls number."
Holdings in the iShares Silver Trust , the world's
largest silver-backed exchange-traded fund, dropped to an
eight-month low of 9,885.4 tonnes by June 3.
Precious metals prices 0607 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1545.75 3.95 +0.26 8.90
Spot Silver 36.75 0.54 +1.49 19.09
Spot Platinum 1821.70 10.55 +0.58 3.07
Spot Palladium 784.45 4.25 +0.54 -1.88
TOCOM Gold 4003.00 21.00 +0.53 7.35 48485
TOCOM Platinum 4768.00 24.00 +0.51 1.53 6746
TOCOM Silver 95.00 1.50 +1.60 17.28 1671
TOCOM Palladium 2044.00 53.00 +2.66 -2.53 256
COMEX GOLD AUG1 1547.40 5.00 +0.32 8.86 7409
COMEX SILVER JUL1 36.78 0.59 +1.63 18.88 4216
Euro/Dollar 1.4636
Dollar/Yen 80.31
TOCOM prices in yen per gram. Spot prices in $ per ounce.
COMEX gold and silver contracts show the most active months
Source