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Fed Chair Powell to deliver Jackson Hole address at 1400

GMT

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US weekly jobless claims jump to near 3-month high last

week

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Markets put chance of Fed rate cut next month at 75%

(Updates for Asia midday session)

By Anmol Choubey

Aug 22 (Reuters) - Gold prices edged lower on Friday on

a stronger dollar while investors awaited U.S. Federal Reserve

Chair Jerome Powell's speech at the annual Jackson Hole

symposium that could offer fresh clues on the monetary policy

path.

Spot gold edged down 0.2% to $3,333.01 per ounce by

0353 GMT. U.S. gold futures for December delivery fell

0.2% to $3,376.

The U.S. dollar index hovered near a two-week high,

making gold less attractive to overseas buyers.

Fed officials appeared lukewarm on Thursday to the idea of a

rate cut next month as investors geared up for Powell's speech,

due at 1400 GMT on Friday.

"With a Russia-Ukraine peace deal still a possibility, and

the USD attracting some buyers, gold is facing headwinds," KCM

Trade chief market analyst Tim Waterer said.

"But if Powell's message is interpreted as being a dovish

shift, the USD could be undone, and gold may be on the move

higher again."

Futures markets indicate a 75% chance of a quarter-point

rate reduction next month, according to CME's FedWatch tool.

Recent labour data showed U.S. jobless claims rose last week

by the most in nearly three months, while unemployment claims

the previous week hit a near four-year high.

The challenge for Fed policymakers is that even as there

have been signs of labour market weakening, inflation remains

above the central bank's 2% target and could well go higher due

to the Trump administration's aggressive hiking of tariffs on

imports.

Russian President Vladimir Putin is demanding that Ukraine

give up all of the eastern Donbas region, renounce ambitions to

join NATO, remain neutral and keep Western troops out of the

country, three sources familiar with top-level Kremlin thinking

told Reuters.

Elsewhere, spot silver was down 0.2% to $38.08 per

ounce, platinum fell 0.9% to $1,341.46, and palladium

rose 0.2% to $1,112.92.