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Gold Gains on Dollar Dip ahead of U.S. Jobs Data

* France delays easing restrictions due to Delta variant

* Gold prices still in a downtrend, analyst says

July 1 (Reuters) - Gold rose on Thursday in step with a dip in the dollar and Treasury yields, paring some of the precious metal’s losses last month, as investors turned their attention to the release of the U.S. monthly nonfarm payrolls report.

Spot gold was up 0.3% to $1,775.50 per ounce by 10:15 a.m. EDT (1415 GMT), moving further away from the more than two-month low hit earlier this week. U.S. gold futures were up 0.6% at $1,781.30.

The dollar index edged down 0.1% and benchmark U.S. Treasury yields also moved lower to reduce non-yielding gold’s opportunity cost.

Gold posted its biggest monthly loss since November 2016 in June as a surprise hawkish shift by the Federal Reserve dented the metal’s appeal.

“(Gold) prices are still in a downtrend. We’re seeing a corrective bounce,” said Jim Wyckoff, senior analyst with Kitco Metals, attributing gold’s uptick on Thursday to some bargain buying on a weaker dollar and yields.

“For gold to turn a corner, you’re going to have see multiple closes above $1,800,” Wyckoff said.

Market participants’ are eying Friday’s nonfarm payrolls report for clues on the timeline of the U.S. monetary policy shift, only days after Fed officials suggested the U.S. central bank should begin paring back stimulus this year.

Investors also kept a close watch on the spread of the Delta variant of the coronavirus, which prompted French authorities to delay easing COVID-19 restrictions.

“If the rise of the variant forces authorities to introduce new lockdowns, especially in Europe and the United States, then we may be looking at the risk-averse safe-haven trade offering support to gold,” said Ricardo Evangelista, a senior analyst at ActivTrades.

In other metals, silver fell 0.4% to $26.01 per ounce, palladium gained 0.4% to $2,789.37, and platinum rose 1% to $1,082.92.

(Reporting by Nakul Iyer and Arundhati Sarkar in Bengaluru Editing by Paul Simao)

Source: Reuters

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