* Gold retreats as dollar boosted by jobs data
* ECB says it has no bias on interest rates
* SPDR Gold Trust ETF holdings spike 2.2 percent on July 2
(Updates with New York closing prices, market activity)
By Jan Harvey and Raissa Kasolowsky
LONDON, July 3 (Reuters) - Gold retreated from initial
gains to end lower Thursday on a rising dollar, boosted by
in-line U.S. jobs data and comments from the European Central
Bank after its rate rise that were less hawkish than expected.
Gold <XAU=> was at $932.70/934.70 by New York's last quote
at 2:35 p.m. EDT (1835 GMT), down from $942.60/943.60 an ounce
late in New York on Wednesday. It hit a session high of $946.35
in early sessions.
"Part of it is the U.S. dollar but the market may also been
expecting more hawkish comments from the ECB," said Standard
Bank analyst Walter de Wet.
The dollar rose versus the euro <EUR=> after data showed
U.S. employers cut workers from their payrolls for the sixth
straight month in June, while the unemployment rate held steady
at 5.5 percent. []
The U.S. Labor Department said 62,000 jobs were lost from
non-farm payrolls last month compared with forecasts that
60,000 jobs would be lost in June.
Comments by European Central Bank President Jean-Claude
Trichet that they have no bias in terms of interest rates had
also helped boost the dollar, analysts said. []
The ECB raised its benchmark interest rate by a quarter
percentage point to 4.25 percent.
Gold typically moves in the opposite direction to the U.S.
currency, as it is bought as an alternative investment. A
stronger dollar also makes dollar-priced gold more expensive
for holders of other currencies.
MIXED FUNDAMENTALS
Bullion hit a high of $946.50 an ounce on Wednesday, its
strongest level since April 17 on buying triggered by worries
about inflation and record high oil prices.
The U.S. August contract <GCQ8> on COMEX division of New
York Mercantile Exchange settled down $12.90 or 1.4 percent at
$933.60 an ounce.
On the fundamental side, investment demand from gold
remained strong, with gold holdings of the SPRD Gold Trust
jumping 2.2 percent on Wednesday to 658.57 tonnes.
New York-based SPDR, which is the world's largest
exchange-traded fund back by physical gold, is now at its
highest since March 18, when its holdings stood at a record.
Jewellery demand however remains soft, analysts say.
"People are worried about the fundamentals of demand at
these kind of levels," said Fairfax analyst Marc Elliott.
"Jewellers are just not going to be participating (in the
market), and it is a seasonally weak period."
Australia's largest independent gold miner, Newcrest Mining
<NCM.AX>, said meanwhile that it completed the buyback of its
hedge-book.
Newcrest said it bought back just over 4 million ounces of
gold at an average purchase price of A$868 an ounce, A$70 lower
than the average spot price over the period.
In other precious metals, spot platinum <XPT=> was at
$2,017.50/2,037.50 an ounce from $2,065.50/2,085.50 late in New
York on Wednesday.
Spot palladium <XPD=> was down at $460.50/468.50 an ounce
from $463.00/471.00 an ounce.
Silver <XAG=> edged down to $18.21/18.31 from its Wednesday
U.S. close of $18.32/18.39 an ounce. The metal is taking some
support from ongoing strike action in Peru, the world's biggest
producer of the metal.
(Additional reporting by Frank Tang in New York; Editing by
Marguerita Choy)
