PRECIOUS-Gold pares gains after decent jobs data, still set for weekly gain

* U.S. unemployment rate falls to 3.5% in September
* Markets await U.S.-China trade talks next week
* Platinum on track for biggest weekly decline since May

(Updates prices)
By Swati Verma
Oct 4 (Reuters) - Gold steadied on Friday, paring earlier
gains as bets the U.S. Federal Reserve would cut interest rates
aggressively this year were tempered after better-than-expected
U.S. jobs data, but bullion was still on track for a weekly
gain.
Spot gold XAU= was up 0.1% at $1,506.76 per ounce as of
1:43 p.m. EDT (1743 GMT). Prices are still on track for a weekly
gain of about 0.7%. U.S. gold futures GCcv1 settled down 0.1%
at $1,512.90.
U.S. job growth increased modestly in September, with the
unemployment rate dropping to near a 50-year low of 3.5%,
assuaging concerns the slowing economy was on the brink of a
recession. "There were expectations that we might see the biggest
decline in jobs number in years and that did not happen. Gold is
counting on the Fed cutting more interest rates," said Jeffrey
Sica, founder of Circle Squared Alternative Investments.
"Considering how dismal the other economic numbers were,
this jobs report was fairly acceptable. Yesterday, we saw a real
strong sentiment towards the Fed lowering interest rates because
of the economic weakness and this (jobs data) might have the
reverse effect."
U.S. short-term interest rate futures traders on Friday
pared bets the Fed would cut rates at both of its two upcoming
meetings. "The Fed is still expected to cut at least once more this
year, but the December meeting remains a toss-up. The economy is
not falling off a cliff and gold could see some softness, but
the overall bullish trend should remain intact," Edward Moya, a
senior market analyst at OANDA, said in a note.
Gold had risen to a one-week high of $1,518.50 per ounce in
the previous session. Persistent weakness in global economic
indicators against the backdrop of the U.S.-China trade war has
led to a 17% rise in bullion prices so far this year.
Investors will be closely watching the U.S.-China trade
talks, which resume next week. On Friday, White House economic
adviser Larry Kudlow said the U.S. team was "open-minded" about
the outcome of U.S.-China trade talks. "For gold now there is more of a concern that the trade war
is going to get considerably more worse. We made absolutely no
progress and investors are losing confidence in U.S. and China
making a deal," Sica said.
"As result of that, investors are buying gold in
anticipation of more chaos."
Elsewhere, platinum XPT= fell 0.9% to $882.26 an ounce and
was down over 5% this week, on track for its biggest weekly
decline since May.
Silver XAG= was steady at $17.56, and palladium XPD=
climbed 1% to $1,669.25.