Gold gains as dollar weakens, US rate-cut bets grow

By Ishaan Arora

Nov 7 (Reuters) - Gold rose on Friday as the dollar slid after U.S. private-sector job reports signalled weakness in the country's labour market and lifted expectations of another U.S. interest rate cut, while a prolonged government shutdown also boosted safe-haven demand.

Spot gold XAU= was up 0.5% at $3,996.67 per ounce, as of 0537 GMT, but set for a weekly loss of 0.2%. Bullion has fallen 9% since hitting a record high of $4,381.21 on October 20.

U.S. gold futures GCcv1 for December delivery were up 0.3% at $4,004.0 per ounce.

The U.S. economy shed jobs in October amid losses in the government and retail sectors, while cost-cutting measures and the adoption of artificial intelligence by businesses led to a surge in announced layoffs, data showed on Thursday.

"The private jobs data is still indicating that a rate cut in December is likely and that's why gold prices are getting some kind of support," said Soni Kumari, a commodity strategist with ANZ.

The dollar retreated, leading declines among major currencies as investors lacking official data on the U.S. labour market seized upon signs of weakness in private sector surveys.

A weak jobs market typically makes rate cuts more likely. USD/

The focus is now on macro numbers and when the U.S. shutdown is going to get over, which is also helping safe-haven demand for gold, Kumari added.

A congressional impasse has resulted in what is now the longest-ever U.S. government shutdown, which has forced investors and the data-dependent Fed to rely on private sector indicators.

Non-yielding gold tends to do well in a low-interest-rate environment and during times of economic uncertainty.

Elsewhere, spot silver XAG= firmed 1% to $48.46 per ounce, but was set for a weekly loss of 0.4%, platinum XPT= rose 0.2% to $1,544.15, but was down nearly 1.3% for the week, and palladium XPD= rose 0.5% to $1,381.75, headed for a weekly loss of 2.7%.