LONDON, June 6: Gold rose on Friday, gathering strength from higher oil prices and a stronger euro against the dollar after the European Central Bank said euro zone rates could rise in July.

Gold climbed to $886.80/ 887.80 a troy ounce from $874.55/ 875.95 an ounce late in New York on Thursday, when it hit $864.45 -- its lowest level since May 15.

ECB president Jean-Claude Trichet said on Thursday the bank was on high alert over inflation and that the governing council could raise rates as soon as its next policy meeting on July 3.

Jobs data could be very important. People will be careful about taking large positions before then, a trader said. If it hits the consensus then there won’t be a problem, but if its higher or lower then we could see a lot of volatility.

Silver rose to $17.26/17.31 an ounce from $17.12/17.18 an ounce on Thursday. Spot palladium up to $429.00/437 from $421.00/ 429.00 an ounce.—Reuters