Gold prices edged higher Thursday after the government reported surprisingly strong September hiring, but not strong enough to lower the nation's nominal unemployment rate.

Although the nominal unemployment rate remained at 9.1 percent, the number of non-farm jobs last month jumped 103,000, the Labor Department said. However, nearly half of those gains came from striking Verizon workers returning to work. Without them, September's non-farm job creation would have been 58,000.

Economists, according to various surveys, had expected gains between 25,000 to 60,000 after a flat August.

Before the September payroll figures were released gold, which settled Thursday at $1,653.20, hovered within a tight range of $1,647.40 to $1,668.

What you're seeing is demand for physical metal continues to be very, very strong. China was off all this week. They'll be back next week and I presume demand will only increase, so I think that is why the market has held so nicely around this $1,600 mark, MKS Finance head of trading Afshin Nabavi, told Reuters.

The market was extremely bearish in the dollar and extremely bullish on precious ... It's not a one-way street all the time. We needed a correction and don't forget we are talking about less than $300 in a commodity that was priced close to $2,000, he said.

I still wouldn't mind seeing it have a bit more of a correction on the downside first to clean up some of the spec length over the market and towards the end of the year, it will be closer to $2,000 again, he added.

Gold for December delivery gained $2.30 to $1,655.50 while gold for immediate delivery added $7.50 to $1,660.08.

Silver for December delivery slipped 6 cents to $31.95, while silver for immediate delivery gained 59 cents to $32.57.