* Bullion dips for second straight session
* ECB leaves interest rates unchanged at record lows
* ECB revises down inflation forecast
* China markets closed for public holiday
* COMING UP: U.S. non-farm payrolls at 1230 GMT Friday
(Updates prices; adds comment, second byline, changes dateline,
previous LONDON)
By Marcy Nicholson and Clara Denina
NEW YORK/LONDON, Sept 3 (Reuters) - Gold fell 1 percent on
Thursday as the dollar jumped versus the euro after the European
Central Bank (ECB) cut inflation forecasts, while a U.S. jobs
report that could provide clues on the timing of a Federal
Reserve rate rise remained in focus.
The ECB left interest rates unchanged at record lows as
expected, but lowered its forecasts for inflation and economic
growth, citing a slowdown in emerging markets and weaker oil
prices. ID:nL5N118219
As a traditional hedge against inflation, gold suffered from
the downward revision.
Spot gold XAU= fell as much as 1.1 percent to a session
low of $1,121.35 an ounce and was down 0.8 percent at $1,125.20
at 2:47 p.m. EDT (1847 GMT). U.S. gold GCZ5 for December
delivery settled down 0.8 percent at $1,124.50 an ounce.
"No help for gold today: jobless claims, ECB hold(ing) rates
unchanged, gains in stocks and wages show(ing) no inflation,"
said RBC Wealth Management adviser George Gero.
The dollar .DXY rose 0.5 percent against a basket of
leading currencies, while global stock markets rallied amid news
the U.S. trade deficit fell to a five-month low in July.
MKTS/GLOB ID:nL1N1190SK
U.S. weekly jobs data indicated a strengthening labor
market, a day ahead of the more critical monthly jobs report,
due at 8:30 a.m. EDT (1230 GMT) on Friday, which should give a
clearer picture about the strength of the world's biggest
economy. ID:nLNN3KEBFA ECONUS
"Only amazingly good U.S. data would bring the prospect of
the rate hike back to September from December," Citi strategist
David Wilson said. "That could put immediate further pressure on
the gold price."
Bullion traders remain wary of taking up new positions until
they receive more clarity on whether the Fed will raise rates at
its next meeting on Sept. 16-17, analysts said.
Higher interest rates would increase the opportunity cost of
holding non-yielding bullion.
"The euro's down with the ECB comments, and the market's
book-squared and looking toward tomorrow," said James Steel,
chief metals analyst for HSBC Securities in New York.
The technical picture for gold looked bearish with near-term
support at $1,117, ScotiaMocatta analysts said.
"We are bearish gold so long as it trades below the recent
high of $1,170."
Also weighing on bullion was the absence of Chinese buyers
with markets in China, a major gold consumer, closed through
Friday for public holidays.
Other precious metals were also under pressure, with silver
XAG= down 0.3 percent to $14.66 an ounce, platinum XPT= down
1 percent to $1,002 and palladium XPD= down 1.7 percent at
$572.50.