* Gold down for seventh week in a row
* Nonfarm payrolls increase 215,000 in July
* Dollar rebounds after U.S. jobs data
(Releads, updates prices, adds comment)
By Clara Denina
LONDON, Aug 7 (Reuters) - Gold steadied on Friday as
investors assessed U.S. non-farm payrolls data that could open
the door to a Federal Reserve interest rate hike in September,
but was still on course for a weekly fall.
Nonfarm payrolls increased 215,000 last month as a pickup in
construction and manufacturing employment offset further
declines in the mining sector, the Labor Department said on
Friday. The unemployment rate held at a seven-year low of 5.3
percent. ID:nLNN7JEBEB
"Although the market is reading the U.S. data as supportive
of a Fed rate hike in September and is boosting the dollar, it
is still finding value in gold against other assets like
equities," ActivTrades chief analyst Carlo Alberto de Casa said.
Spot gold XAU= , which hit a session low of $1,082.76 an
ounce immediately after the U.S. jobs report, managed to rebound
0.5 percent to $1,095.26 by 1245 GMT. It had fallen to $1,077 on
July 24, its weakest since February 2010.
Prices were still marginally down on the week, with a
seventh weekly loss in a row matching a similar losing streak in
May-June 1999.
U.S. gold for December delivery GCcv1 was up 0.4 percent
at $1,094 an ounce.
The dollar reversed earlier losses and gained 0.3 percent
against a basket of leading currencies, while global shares
fell, against which gold is seen as an alternative investment.
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Analysts continued to see gold's upside as temporary, due to
strong prospects for the dollar. The metal has lost 7.5 percent
this year so far, as investors positioned themselves for an
interest rate increase in the United States this year.
Higher interest rates would put non-yield-bearing gold under
further pressure, increasing the opportunity cost of holding the
metal.
A slew of upbeat U.S. economic data, including Thursday's
positive weekly jobless claims, shows "there's not really much
to stop the Fed from increasing rates", said Ric Spooner, chief
market analyst at CMC Markets in Sydney.
"There's not a lot of natural reasons for investors to buy
gold at the moment. The dollar is getting stronger and there's
no real sign of inflation on the horizon with weaker oil prices
and other commodities," Spooner said.
Gold buyers in Asia were in no hurry, anticipating the
market to weaken further, with premiums in India and Hong Kong
picking up only modestly this week. GOL/AS
Spot platinum XPT= was up 0.4 percent at $954.24 an ounce,
while palladium XPD= rose 1.1 percent to $601.50 and silver
XAG= gained 2.2 percent to $14.89 an ounce.