Gold holds steady as traders wait for US payroll data

Gold prices traded flat on Thursday but were slightly down for the week, as market focus shifted to a crucial U.S. payrolls report for clearer insight into the Federal Reserve‘s anticipated interest rate reduction next month.

FUNDAMENTALS

* Spot gold was steady at $2,657.13 per ounce, as of 0034 GMT. Bullion was on track for a weekly decline, after three straight weekly gains.

* U.S. gold futures fell 0.1% to $2,676.70.

* Data on Thursday showed U.S. services sector activity jumped to a 1-1/2-year high in September amid strong growth in new orders, though its measure of services employment fell, consistent with a slowdown in the labor market. * Additionally, initial jobless claims figures showed the number of Americans filing new applications for unemployment benefits rose slightly more than expected last week.
* Expectations for a 25-basis-point cut at the Fed’s November meeting increased slightly to 69% chances after the recent data. Meanwhile, there’s a 31% chance priced in for a 50-bp cut, according to CME’s FedWatch tool.
* Bullion is considered a safe investment during times of political and financial uncertainty, and thrives in a low-rate environment.
* Israel’s military told residents of more than 20 towns in south Lebanon to evacuate their homes immediately on Thursday, as it pressed on with its cross-border incursion and struck Iran-backed Hezbollah targets in a suburb of Beirut.

* Market focus will now turn towards the U.S. nonfarm payroll data due at 1230 GMT. New York Fed President John Williams and Chicago Fed President Austan are also scheduled to speak later in the day.

* Spot silver edged 0.1% lower to $32.03 per ounce and was up about 1.2% so far this week.

* Platinum gained 0.4% to $994.30 and palladium rose 0.5% to $1,005.25. Both metals were poised for weekly declines.