Gold drops on strong U.S jobs growth, stimulus fears

SINGAPORE (July 8)  Gold fell for a third session
on Monday on fears the U.S. Federal Reserve could soon begin
tapering its bond-buying stimulus after a stronger-than-expected
jobs report.
   
    FUNDAMENTALS
    * Spot gold fell 0.3 percent to $1,219.31 an ounce by
0004 GMT following a 2 percent decline on Friday.
    * Comex gold was higher by about $6 at $1,218.30.
    * U.S. employers added 195,000 new jobs to their payrolls
last month, exceeding expectations of 165,000, the Labor
Department said on Friday, cementing expectations the Fed will
start winding down its $85 billion monthly bond purchases.

    * The Fed is likely to begin shrinking the size of its debt
purchase program, intended to prop up economic growth and
support the labor market, by September, according to the
majority of economists at large Wall Street firms.

    * Gold posted its biggest quarterly loss on record, down 23
percent for April-June and hit a near 3-year low of $1,180.71
last month, after Fed Chairman Ben Bernanke said the economy was
recovering strongly enough for the bank to begin tapering.
    * SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, said its holdings fell 0.28 percent to
961.99 tonnes on Friday.
    * China's May gold imports from Hong Kong jumped more than a
third from the previous month as lower prices attracted buyers
in the world's second biggest bullion consumer.
    * Jewellers in India are banking on a growing appetite for
diamonds in the country and resilient demand for gold among its
non-residents to offset a slowdown caused by a government
clampdown on imports of the precious metal.