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Gold retreats from three-week high as U.S. dollar stabilizes

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Gold prices slipped on Monday to retreat from a three-week high scaled in the previous session, as the U.S. dollar regained some ground, making bullion more expensive for overseas buyers.

FUNDAMENTALS

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* Spot gold was down 0.5% at $1,672.30 per ounce, as of 0025 GMT. Bullion prices surged 3% on Friday as the dollar fell nearly 2% after U.S. jobs data raised hopes about the U.S. Federal Reserve being less aggressive on rate hikes going forward.

* U.S. gold futures were flat at $1,676.10.

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* The dollar index reclaimed some lost ground to edge up 0.1%.

* Although gold is considered a hedge against inflation, higher interest rates increase the opportunity cost of holding the non-yielding asset.

* U.S. job growth increased more than expected in October, but the pace is slowing and the unemployment rate rose to 3.7%, suggesting some loosening in labor market conditions.

* Four Fed policymakers on Friday indicated they would still consider a smaller interest rate hike at their next policy meeting, despite new data showing another month of robust job gains and only small signs of progress in lowering inflation.

* Physical gold demand in India eased last week with jewelers awaiting a dip in domestic prices to stock up for the wedding season following a festival rush.

* Spot silver was down 1.6% at $20.49, platinum fell 1.4% to $947.40 and palladium lost 0.2% to$1,859.15.

DATA/EVENTS (GMT)

0300 China Exports, Imports YY Oct

0300 China Trade Balance Oct

0700 Germany Industrial Output MM Sept

0700 Germany Industrial production YY SA Sept

0700 UK Halifax House Prices MM, YY Oct (Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Sherry Jacob-Phillips)



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