* Gold falls for second straight session
* Could decline below $1,200/oz -analyst
* SPDR assets drop, speculators raise bullish positions
(Updates prices)
By A. Ananthalakshmi
SINGAPORE, April 4 (Reuters) - Gold extended losses on
Monday after a better-than-expected U.S. jobs report signalled
strength in the economy and stoked speculation the Federal
Reserve could raise interest rates soon.
Bullion's recent losses take it closer towards the key
$1,200 an ounce level, a breach of which could trigger technical
selling.
Spot gold XAU= had eased 0.5 percent to $1,215.48 an ounce
by 0648 GMT, after dropping 0.8 percent on Friday.
"We could see the markets start coalescing around
expectations that the Fed will now put a rate increase back on
the table, perhaps for some time in May or June," said INTL
FCStone analyst Edward Meir.
Gold could fall below $1,200 soon and test key double bottom
support at around $1,170-$1,175, he said.
Gold posted its biggest quarterly rise in nearly 30 years in
the March quarter, rallying 16 percent as expectations faded
that the Fed would move to normalize interest rates due to
concerns over the global economy. The U.S. central bank raised
rates in December for the first time in nearly a decade.
The metal is highly exposed to rising rates, which lift the
opportunity cost of holding non-yielding assets, while boosting
the dollar.
Data on Friday showed nonfarm payrolls rose by 215,000 last
month, higher than expectations of 205,000, underscoring the
strength in the U.S. economy.
U.S. interest rate futures suggested traders are now betting
the Fed will next raise rates as soon as November, versus
December ahead of the report. Wall Street's top banks held firm
to their expectation for a rate hike in June, according to a
Reuters survey conducted on Friday.
In the near term, support for gold sits around $1,215 and
below this at $1,210, said MKS Group trader Sam Laughlin.
Investor positioning in gold is largely bullish. Hedge funds
and money managers boosted their bullish bet in gold in the week
to March 29, to the highest since the end of 2012, U.S.
Commodity Futures Trading Commission data showed on Friday.
Assets in SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, fell 0.15 percent to 818.09 tonnes on
Friday, but remain near the highest in over two years.
In the wider markets, Asian share prices held firm on Monday
after solid U.S. payroll data underpinned investor risk
sentiment. MKTS/GLOB
PRICES AT 0648 GMT
Metal Last Change Pct chg
Spot gold 1215.48 -6.63 -0.54
Spot silver 14.971 -0.057 -0.38
Spot platinum 946.25 -8.25 -0.86
Spot palladium 556.25 -9.35 -1.65
Comex gold 1217.5 -6 -0.49
Comex silver 14.97 -0.076 -0.51
COMEX gold and silver contracts show the
most active months