PRECIOUS-Gold eases back towards 2-1/2-week low after US jobs data – Reuters

* Gold retains declines from 3-day losing streak

* U.S. job growth slowed in August; unemployment rate down

* Dollar steadies, European stocks push higher

* GRAPHIC-Asset returns:

(Updates prices, adds comment)

By Jan Harvey

LONDON, Sept 7 (Reuters) – Gold eased back towards its
lowest since mid-August on Monday as stock markets firmed and
the dollar steadied, and after U.S. payrolls data failed to
provide clarity on the timing of a Federal Reserve rate hike.

Having failed to benefit from recent turmoil in stock
markets after China devalued its currency last month, gold is
now struggling to find direction outside of U.S. monetary
policy, analysts said.

Spot gold was down 0.4 percent at $1,118.70 an ounce
at 1509 GMT, while U.S. gold futures for December
delivery were down $3.50 an ounce at $1,117.90.

“Gold didn’t do enough during the equity market turmoil in
China, or the yuan devaluation in China. People were expecting
it to go up and it didn’t, so they lost interest,” Citi analyst
David Wilson said.

“The market has already assumed that there may not be a
September rate hike, so if anything, if there is a hike, there
is more risk on the downside.”

Spot gold lost 1 percent last week and has fallen more than
5 percent this year, largely on expectations for a rise in U.S.
interest rates.

That would lift the opportunity cost of holding non-yielding
bullion while boosting the dollar, in which it is priced.
Bullion traders said uncertainty over the timing of a hike will
keep gold under pressure until the Fed meets on Sept. 16-17.

The Fed has already indicated that the timing of a hike is
largely data-dependent.

Friday’s hotly anticipated non-farm payrolls report showed
the U.S. economy added fewer jobs than expected last month,
though the unemployment rate fell to its lowest since 2008.

“The number was too good for those who hoped that the Fed
would postpone the rate hike, and too little for those who were
hoping (they’d go ahead with) it. That’s why on the gold side,
the market just got stuck,” Julius Baer analyst Carsten Menke

European stocks rose on Monday, lifted by mining and
commodities giant Glencore after it pledged to slash its debt by
a third. The dollar index steadied.

Gold prices got little support with the resumption of
trading in key gold consumer China after public holidays.
Premiums on the Shanghai Gold Exchange were steady at about $4
an ounce on Monday, indicating stable buying interest.

With the U.S. markets closed for the Labor Day holiday on
Monday, trading is likely to be thin.

Among other precious metals, silver was down 0.6
percent at $14.48 an ounce, while platinum was down 0.6
percent at $982.75 an ounce and palladium was up 1.2
percent at $578.25 an ounce.

(Additional reporting by A. Ananthalakshmi in Singapore;
Editing by Mark Potter and Susan Fenton)