PRECIOUS-Gold holds steady as spotlight shifts to US payrolls data

* U.S. non-farm payrolls report due on Friday * Traders see 74% chance of a 25-bps rate cut in December * Powell says Fed can afford to be a little more cautious (Updates with mid-session trading) By Anushree Mukherjee Dec 5 (Reuters) - Gold prices steadied on Thursday as investors held back from placing big bets ahead of U.S. non-farm payrolls data that could influence the Federal Reserve's interest rate trajectory as markets awaited this year's final policy-setting meeting. Spot gold XAU= held its ground at $2,649.69 per ounce, as of 1221 GMT. U.S. gold futures GCv1 also eased 0.1% to $2,673.30. The market's focus is on initial jobless claims due later in the day and the U.S. non-farm payrolls (NFP) report on Friday, with the payrolls likely increasing by 200,000 jobs in the month after rising by only 12,000 in October. A robust NFP number is more or less priced in, and if we see weakness in the report, it could add some support to gold prices as the market is kind of pricing in that the U.S. economy is doing quite well, said Ole Hansen, head of commodity strategy at Saxo Bank. Gold market is seeing "a relatively tight range. It does indicate the market is lacking a bit of oxygen, lacking a bit of directional input," Hansen said. Fed Chair Jerome Powell said on Wednesday that the U.S. economy is stronger than expected and suggested a more cautious stance towards interest rate cuts. Traders are pricing in a 74% chance of a 25-basis-point cut at the Fed's Dec. 17-18 meeting, according to the CME Group's FedWatch Tool. Bullion, which does not pay any interest, historically performs well in a low-interest rate environment. "Gold prices could see a short-term rise toward $2,700 per ounce, driven by seasonal weakness in the U.S. dollar, which historically underperforms in December. However, a deeper correction in gold prices remains possible over the medium term," said Zain Vawda, market analyst at MarketPulse by OANDA. USD/ Spot silver XAG= was up 0.1% at $31.32 per ounce. Platinum XPT= rose 0.2% to $942.95 and palladium XPD= fell 0.1% to $976.83. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Spot gold price in USD per oz https://reut.rs/3Zjza9H ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Anushree Mukherjee in Bengaluru; Editing by Sherry Jacob-Phillips, Elaine Hardcastle and Shailesh Kuber) (([email protected];))