PRECIOUS-Gold drops 1%, set for weekly fall on positive U.S. data, trade optimism

* Gold down about 0.9% so far this week
* Silver on track to post its first weekly fall in five
* U.S. non-farm payrolls report due at 1230 GMT

(Updates prices)
By K. Sathya Narayanan
Sept 6 (Reuters) - Gold fell 1% on Friday, putting it on
track for its second straight weekly fall, as robust economic
data from the United States and the planned resumption of trade
talks between Washington and Beijing boosted appetite for
riskier assets.
Spot gold XAU= was down 0.9% at $1,505.41 per ounce as of
1152 GMT, having shed as much as 1% earlier in the session, and
retreating from an over six-year peak of $1,557 touched on
Wednesday.
Gold fell more than 2% on Thursday and was down about 0.9%
so far this week.
U.S. gold futures GCcv1 slid 0.8% to $1,513.80.
"The good economic news from the U.S. and the news of the
restart of trade negotiations drove risk-on sentiment and in
turn drove down demand for gold and other safe-haven assets,"
said SP Angel analyst Sergey Raevskiy.
U.S data showing private employers' payrolls rose and the
growth of the services sector accelerated in August increased
investors' appetite for riskier assets, which were already
buoyed by positive signs on U.S.-China trade talks. MKTS/GLOB
Investors now await the monthly U.S. non-farm payrolls
report due at 1230 GMT for further cues on the health of the
world's biggest economy.
"Most of it (gold's movement) will depend on the jobs report
and if the data comes out stronger, we might see prices dip
below (the $1,500 level)," Raevskiy said, adding people will buy
on dips as gold is still supported by the lack of a "resolution"
in the trade war and negative-yielding sovereign debts.
Expectations for further monetary policy easing around the
globe was adding further support to bullion, analysts said. The
yellow metal has risen about 17% this year.
Despite the reassuring U.S. economic signs, bond markets
still expect the Federal Reserve to cut interest rates this
month. FEDWATCH
Lower interest rates and Treasury yields reduce the
opportunity cost of holding non-yielding bullion.
Other precious metals fell along with gold, with silver
slumping 2.7% to $18.12 per ounce, adding to its 4.8% slide on
Thursday. It was on track to post its first weekly fall in five.
"We do not believe that this latest correction constitutes a
trend reversal but see it rather as (gold and silver) prices
taking a breather within an otherwise intact upward trend,"
Commerzbank analyst Daniel Briesemann said in a note.
Spot platinum XPT= dropped 3.1% to $928.95 an ounce, while
palladium XPD= fell 2.1% to $1,526.62.