An upbeat payrolls report would reinforce the view that a US rate rise is on the cards, with Fed officials having sounded a hawkish note at a meeting last weekend, pressuring gold further.
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Shortly after United Kingdom market close, gold was up US$5 to US$1,113, silver was up 15c to US$18.78, while platinum fell US$4 to trade at US$1,044.
The Labor Department will release its closely watched employment report on Friday and readings in line with expectations would reinforce views that the economy has regained speed after nearly stalling in the first half of the year.
Traders are pricing in just a 12 percent chance that the Reserve Bank will cut interest rates at its next meeting on September 22 but the odds of a 25 basis point cut by the monetary policy statement on November 10 are now around 77 percent.
The Fed lifted its benchmark overnight interest rate at the end of past year for the first time in almost a decade, but has held it steady since amid concerns over persistently low inflation.
The market expects the U.S. economy added 180,000 jobs in August, down from 255,000 in July.
Over the last several years, the government’s August payrolls estimates have been weak prior to upward revisions.
The Swedish crown hit a one-year low of 9.6210 crowns per euro after a run of weak economic data fanned fears of a steeper-than-expected economic slowdown and that the central bank will delay planned interest rate hikes. But a calendar quirk could mean a soft reading, which would pull down the year-on-year from 2.6 percent in July.
Nonfarm payrolls likely increased by 180,000 jobs last month, according to a Reuters survey of economists, around this year’s monthly average job growth.
J.P. Morgan said in a morning note that the dollar may have only a limited room to go downside, if the USA nonfarm payrolls grew by 100,000 or more in August.
“(Thursday’s fall in the dollar) tells us that there still is a lot of scepticism over imminent rate hike by the Fed in the market”, said Commerzbank currency strategist Thu Lan Nguyen, from Frankfurt. Despite some gains, the participation rate remains near multi-decade lows, in part reflecting demographic changes.
Spot gold had edged up 0.1 percent to $1,315.16 per ounce by 0058 GMT.
The Atlanta Fed is forecasting gross domestic product rising at a 3.2 percent annual rate in the third quarter.
Last month, manufacturing sector employment fell 14,000 after rising for two straight months.
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The dollar index.DXY =USD slipped to 95.669, though it is still above its low so far this week of 95.479, with its fate seen hinging on the looming jobs data.
