Gold falls after weak U.S. jobs data

By Jan Harvey

LONDON (Reuters) - Gold fell on Friday as investors sold assets after data showed a much larger-than-expected fall in U.S. November non-farm payrolls.

A sharp dip in the dollar in the immediate wake of the numbers initially sent gold higher, but it quickly gave up gains as the U.S. currency reversed direction.

The precious metal is often bought as an alternative investment to the dollar and tends to move in the opposite direction to it.

Spot gold was quoted at $752.30/754.30 an ounce at 2:27 p.m., against $765.70 late in New York on Thursday, having earlier touched a low of $747.20.

"(The data) shows a worsening economic situation, and it is hard for assets to maintain value against that," said John Meyer, an analyst at Fairfax investment bank.

U.S. non-farm payrolls fell by 533,000 in November, sending the unemployment rate to 6.7 percent, the highest since 1993. Analysts had predicted payrolls would fall by 340,000.

The other main external driver of gold, crude oil, also weighed on the precious metal, as prices dropped nearly 2 percent to below $43 an ounce.

Sharp falls in the crude price this week have sent oil down to a near four-year low. Weaker oil prices can undermine interest in commodities as an asset class, analysts say.