* Gold supported by dovish Fed
* Asian shares weak; US dollar near 5-1/2 month low
* Coming up: U.S. nonfarm payrolls at 1230 GMT
(Adds stock move, updates prices)
By A. Ananthalakshmi
SINGAPORE, April 1 (Reuters) - Gold edged higher on Friday
as Asian shares fell, adding to its biggest quarterly gain in
nearly 30 years, though caution prevailed ahead of the U.S.
non-farm payrolls report.
Bullion has climbed 1.4 percent so far this week, its best
such rise in four weeks, after Federal Reserve Chair Janet
Yellen said that the U.S. central bank should proceed only
cautiously as it looks to raise interest rates.
Gold is sensitive to rising rates, which lift the
opportunity cost of holding non-yielding assets, while boosting
the dollar.
However, better-than-expected payrolls data could revive
expectations of higher U.S. rates, strengthen the dollar and
hurt gold. U.S. payrolls due later on Friday are expected to
grow by 205,000, according to a Reuters poll.
Spot gold XAU= gained 0.1 percent to $1,233.30 an ounce by
0705 GMT, following a 0.6 percent rise overnight.
"If we start to see macro readings out of the United States
pick up a head of steam (with a strong jobs number helping) this
could prompt a change in the current thinking that the Fed will
remain dovish for a long while," INTL FCStone analyst Edward
Meir said in a note.
A robust number could instead revive expectations that an
interest rate hike in June is possible, Meir said.
U.S. economic data will remain in focus as investors try to
gauge the strength of the economy and its impact on monetary
policy.
Data on Thursday showed the number of Americans filing for
unemployment benefits unexpectedly rose last week, but a sharp
drop in layoffs in March suggested the labour market momentum
remained intact.
In the wider markets, a rout in Japanese shares led Asian
markets lower on Friday as a gloomy suite of surveys on Japanese
manufacturing sparked heavy fund selling and overshadowed upbeat
news from China's vast factory sector. MKTS/GLOB
The dollar found some respite on Friday after steep
quarterly losses against major rivals, but was not very far from
its lowest since mid-October reached on Thursday. USD/
In the physical bullion market, higher gold prices curbed
demand for the precious metal in Asia, with premiums in several
major markets taking a hit. GOL/AS
India's gold demand in the March quarter is set to drop by
about two-thirds from a year ago to its lowest in seven years.
AT 0705 GMT
Metal Last Change Pct chg
Spot gold 1233.3 1.35 0.11
Spot silver 15.35 -0.066 -0.43
Spot platinum 977.2 4.7 0.48
Spot palladium 569.8 7.8 1.39
Comex gold 1235 -0.6 -0.05
Comex silver 15.395 -0.069 -0.45
COMEX gold and silver contracts show the most
active months