Gold prices traded lower within a narrow range on Friday, as investors are content to stick to the sidelines ahead of U.S. nonfarm payrolls later in the session. The lack of monetary easing from major central banks slashed buying interest in gold.
Gold prices fell on Thursday after the European Central Bank (ECB) and the Bank of England (BOE) provided no hints for more economic stimulus, while encouraging jobless claims data from U.S. fuelled optimism about the coming nonfarm payrolls report.
Spot gold is trading around $1578.31 per ounce by 08:34 (GMT+2) after opening at $1577.87, hitting a high of $1580.19 and a low of $1576.16 an ounce.
Silver is trading at $28.80 an ounce after opening at $28.84, hitting high at $28.91 and low at $28.73 an ounce.
The European Central Bank kept its monetary policy on hold for an eighth consecutive month at a record low of 0.75 percent, citing positive economic survey indicators. However, Mario Draghi clarified that ECB`s governing council had discussed the possibility of cutting interest rate.
Policy makers at the Bank of England opted to leave both interest rate and APF size unchanged at 0.50 percent, and APF at 375 billion pounds.
The euro is trading at $1.3093, as of 08:38 AM (GMT +2), after opening at $1.3105. The EUR / USD pair has so far set a session high at $1.3114 and low of $1.3086.
Sentiment toward gold has shifted, as evidence of global growth weighed on the metal’s inflation hedge appeal. The world’s third largest economy expanded during the fourth quarter of 2012, adding to signs the Japanese economy is able to face recent challenges.
The trading range for gold today is expected between key support at $1570.00, and key resistance now at $1585.00.
The rally in the dollar has created headwinds for gold, pushing the yellow metal to trade lower, dollar strength has come on the heels of better than expected. U.S. jobless claims data showing signs of improvement ahead of the nonfarm payroll report due today.
As of 08:35 (GMT+2), the dollar index hovered around 82.21 after opening at 82.07, where it hit a high of 82.25 and a low of 82.07.