(Updates prices, adds quotes)
    * Gold set for best week since March
    * U.S. job growth slows; wage gains miss expectations
    * Palladium drifts away from all-time highs
    * Platinum set for fifth straight weekly decline

    By Swati Verma
    BENGALURU, Dec 7 (Reuters) - Gold hit a five-month peak on
Friday as the dollar slid following weaker-than-expected U.S.
jobs data, which added to expectations the U.S. Federal Reserve
may go slow on interest rate hikes next year.
    Spot gold  XAU=  gained 0.7 percent to $1,245.74 per ounce
at 11:45 am EST (1645 GMT), having hit $1,246.72 per ounce
earlier, its highest since July 13.
    With a rise of nearly 2 percent this week, gold looked set
to post its best gain since the week of March 23.
    U.S. gold futures  GCcv1  were also 0.6 percent higher at
$1,251.30 per ounce.
    "The non-farm payroll data came out lower than expected. It
is a negative pick that is causing people to hedge a little bit
more in gold and any shorts are probably covering and adding few
longs to the market," said Miguel Perez-Santalla, vice president
of Heraeus Metal Management in New York.
    The dollar  .DXY  eased against a basket of currencies on
Friday after data showed U.S. job growth slowed in November and
monthly wages increased less than expected, suggesting some
moderation in economic activity.  urn:newsml:reuters.com:*:nUSN7NEEOA  USD/ 
    "Soft employment report reinforces the narrative that we
have perhaps seen the highs in employment... so I think a
December hike is done but anything in 2019 is up in the air," 
said Tai Wong, head of metals trading at BMO.
    Interest rate futures  IRPR  suggested traders see not more
than one rate increase from the Fed next year, compared with
previous expectations for possibly two rate hikes.  urn:newsml:reuters.com:*:nL1N1YC0NN
    "With increased volatility and geopolitical risk, macro
asset allocation is becoming more gold-positive again while we
believe much of the dollar's upward move is now behind us with
rate hike expectations dropping," analysts at BMO Capital
Markets said in a note.
    Gold, which is considered a safe investment during times of
financial, economic and geopolitical uncertainty, has recovered
about 7 percent from 19-month lows hit in mid-August.
    "At this point it looks like the price of gold has a strong
foundation at these levels and should remain in a bullish mode
the rest of the year," Walter Pehowich, executive vice president
of investment services at Dillon Gage Metals wrote in a note.
    Meanwhile, spot palladium  XPD=  rose 1.2 percent to
$1,223.50 per ounce and was set to post its second straight
weekly gain.
    The autocatalyst metal, however, drifted further away from
an all-time high of $1,263.56 hit this week.
    Silver  XAG=  gained 0.7 percent to $14.57 per ounce and was
headed for a weekly rise of more than 2 percent.
    Platinum  XPT=  rose 0.2 percent to $788.50. The metal
earlier hit a three-month low of $779 and extended losses for a
fifth successive week.

 (Reporting by Swati Verma and K. Sathya Narayanan in Bengaluru;
Editing by Bernadette Baum and Tom Brown)
 ((Swati.Verma@thomsonreuters.com;  within U.S. +1 651 848 5832,
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