* U.S. economy added 217,000 jobs in May, broadly as
* Gold gives up some of near-1 percent rally driven by ECB
* Platinum prices rise as hope for strike resolution fades
(Rewrites first paragraph and updates prices)
By Josephine Mason and Jan Harvey
NEW YORK/LONDON, June 6 (Reuters) - Gold prices were
slightly lower on Friday as the dollar rose after a closely
watched monthly U.S. jobs report underscored expectations of a
steady recovery in the world's No. 1 economy, while platinum
group metals were buoyed by strikes.
Spot gold was down 0.08 percent at $1,252.26 an ounce
at 3:17 p.m. EDT (1917 GMT), off an earlier low of $1,246.5,
while U.S. gold futures for August delivery settled at
$1,252.5 an ounce, down 0.06 percent.
Traders had held off taking new positions ahead of the data
after a near 1-percent gold price rally in the previous session
following new stimulus measures from the European Central Bank.
While appetite for the metal initially picked up after the
report, gains were capped by expectations that the Federal
Reserve will continue to unwind its stimulus measures and that
other assets will offer better returns, as well as the dollar's
"There can't be a substantial price rebound without any
meaningful investor or consumer buying," VTB Capital analyst
Andrey Kryuchenkov said.
"Major players will remain on the sidelines for now.
European investors would be putting money into blue-chip
equities, while with improving risk sentiment there is even less
incentive to invest in gold."
Nonfarm payrolls increased 217,000 last month, the Labor
Department said on Friday, against expectations for a 218,000
rise, while data for March and April was revised to show 6,000
fewer jobs created than previously reported.
The dollar initially fell after the report as U.S. Treasury
yields dipped, but later rebounded. U.S. stocks rose.
Among other precious metals, platinum added to gains after
South Africa's AMCU union president said the union's 12,500 rand
($1,200) per month wage demand was "non-negotiable", dashing
hopes of a speedy resolution to a five-month strike.
Spot platinum touched fresh August 2011 highs of $844
per ounce and was up 0.5 percent at $1,444 an ounce, while spot
palladium was up 0.8 percent at $842.00 an ounce, on
track for its fourth straight week of gains.
"If after further arbitration, the strike is not resolved
the government has the option of declaring the strike illegal,"
HSBC said in a note. "The apparent stalemate has boosted
platinum group metal prices but we are mindful that any bearish
news could take prices lower, at least in the near term."
Spot silver was down 0.11 percent at $18.98 an ounce,
but the industrial metal put in its best week since mid-March.
(Additional reporting by A. Ananthalakshmi in Singapore;
Editing by Pravin Char and Grant McCool)