Gold ends lower as dollar rise prompts selling

By Jan Harvey and Raissa Kasolowsky

LONDON (Reuters) - Gold retreated from initial gains to end lower Thursday on a rising dollar, boosted by in-line U.S. jobs data and comments from the European Central Bank after its rate rise that were less hawkish than expected.

Gold was at $932.70/934.70 by New York's last quote at 2:35 p.m. EDT (1835 GMT), down from $942.60/943.60 an ounce late in New York on Wednesday. It hit a session high of $946.35 in early sessions.

"Part of it is the U.S. dollar but the market may also been expecting more hawkish comments from the ECB," said Standard Bank analyst Walter de Wet.

The dollar rose versus the euro after data showed U.S. employers cut workers from their payrolls for the sixth straight month in June, while the unemployment rate held steady at 5.5 percent.

The U.S. Labor Department said 62,000 jobs were lost from non-farm payrolls last month compared with forecasts that 60,000 jobs would be lost in June.

Comments by European Central Bank President Jean-Claude Trichet that they have no bias in terms of interest rates had also helped boost the dollar, analysts said.

The ECB raised its benchmark interest rate by a quarter percentage point to 4.25 percent.

Gold typically moves in the opposite direction to the U.S. currency, as it is bought as an alternative investment. A stronger dollar also makes dollar-priced gold more expensive for holders of other currencies.