*

US weekly jobless claims rise more than expected

*

Trump tariff push given new twist by court setback

*

US PCE due on Friday

(Rewrites throughout, updates prices for U.S. morning session)

By Ashitha Shivaprasad

May 29 (Reuters) - Gold prices rose in volatile trading

on Thursday, aided by softer jobs data, while market

participants also digested a court ruling that blocked most of

U.S. President Donald Trump's tariffs.

Spot gold reversed course to rise 0.9% to $3,319.22

an ounce, as of 09:37 ET (1337 GMT), after hitting its lowest

since May 20 earlier in the session.

U.S. gold futures were steady at $3,294.60.

Data showed that the number of Americans filing new

applications for unemployment benefits increased more than

expected last week.

"Gold is rallying on a jump in weekly initial jobless claims

which could be a harbinger of a weakening labor market, which

would get the Federal Reserve to cut (interest rates) more

quickly," said Tai Wong, an independent metals trader.

According to released minutes of the Federal Reserve's May

6-7 session, Fed officials acknowledged they could face

"difficult tradeoffs" in coming months in the form of rising

inflation alongside rising unemployment, an outlook buttressed

by Fed staff projections of increased risks of a recession.

Bullion is viewed as a hedge against uncertainty and

inflation, and it tends to perform well in low-interest rate

environments, as it does not generate interest.

Market focus is also on the U.S. Personal Consumption

Expenditures data due Friday, which will be closely analysed for

signals on future U.S. monetary policy.

"Equally impressive is gold's sharp recovery overnight,

(with the market) deciding that Trump will ultimately prevail

against the trade court's ruling," Wong added.

A U.S. trade court ruling that blocked most of Trump's

tariffs and found he had overstepped his authority triggered

some relief on financial markets, while adding to the

uncertainties weighing on the global economy.

His administration immediately said it will appeal and

analysts said investors will remain cautious as the White House

explores its legal avenues.

Spot silver rose 0.9% to $33.28 an ounce,

platinum was up 1% at $1,085.59 and palladium

firmed 0.6% to $968.43.