PRECIOUS-Gold slips 2% as recovery hopes bolster risk appetite

* Gold hits lowest level since May 7
* Private payrolls drop by 2.76 mln in May vs 9 mln forecast
* For an interactive graphic tracking the global coronavirus
spread, open https://tmsnrt.rs/3aIRuz7 in an external browser

(Adds comment, updates prices)
By Eileen Soreng
June 3 (Reuters) - Gold fell more than 2% on Wednesday as
risk sentiment improved on hopes of a faster recovery from a
coronavirus-driven economic slump, with investors largely
overlooking civil unrest in the United States.
Spot gold XAU= fell 1.6 % to $1,699.37 per ounce by 1:05
p.m. EDT (1705 GMT), having earlier hit a near one-month low of
$1,688.89.
U.S. gold futures GCcv1 fell 1.75 % to $1,703.50 per
ounce.
"There is a strong risk-on sentiment right now... U.S.
equity markets are breaking out," said Phil Streible, chief
market strategist at Blue Line Futures in Chicago.
A gauge of global equity markets rose and the euro gained
against the dollar on Wednesday as easing lockdowns and hopes
for more monetary stimulus boosted investor confidence.
MKTS/GLOB .N USD/
Sentiments were also bolstered by data showing U.S. private
payrolls fell less than expected in May, suggesting layoffs were
abating as businesses reopen.
Also, data from Institute for Supply Management showed U.S.
services industry activity pushed off an 11-year low in May.

"It (latest economic data) shows that maybe things are
coming back faster than expected," said Bob Haberkorn, senior
market strategist at RJO Futures.
The supporting fundamentals for gold like lower interest
rates and quantitative easing programs have not changed,
Haberkorn said, adding, in longer term gold should go higher.
Lower interest rates reduce the opportunity cost of holding
non-yielding gold, which also tends to benefit from widespread
stimulus measures as it is often seen as a hedge against
inflation and currency debasement.
U.S. protesters ignored curfews overnight as they vented
their anger over the death of an unarmed black man at the hands
of police. Holdings of SPDR Gold Trust GLD gold-backed
exchange-traded fund rose to 1,129.28 tonnes on Tuesday, their
highest since April 2013. GOL/ETF
Elsewhere, palladium XPD= fell 0.3% to $1,943.14 an ounce,
while platinum XPT= dipped 0.5%, to $834.78 per ounce.
Silver XAG= fell 2.3% to $17.68 per ounce.