Investing.com - Gold prices slumped to a fresh four-week low in North American trade on Thursday, adding to losses after a pair of U.S. economic reports increased the chances of an interest rate increase in coming months.
Meanwhile, investors stayed cautious as the closely watched summit of central bankers in Jackson Hole got ready to kick off.
Gold for December delivery on the Comex division of the New York Mercantile Exchange fell to an intraday low of $1,321.05 a troy ounce, a level not seen since July 27.
It was last at $1,323.25 by 8:48AM ET (12:48GMT), down $6.45, or 0.49%. Prices sank $16.40, or 1.22%, on Wednesday.
The number of individuals filing for initial jobless benefits fell by 1,000 last week to a five-week low of 261,000, the Labor Department said. Analysts expected jobless claims to rise by 3,000 to 265,000 last week.
A separate report showed that U.S. orders for long lasting manufactured goods bounced back more than forecast in July, recovering from the prior month’s decline.
The upbeat data bolstered expectations of faster economic growth and raised the probability of a Federal Reserve interest rate increase this year.
Investors now looked ahead to a highly anticipated speech from Federal Reserve Chair Janet Yellen on Friday for fresh clues on the timing of the next U.S. rate hike.
The annual Fed symposium has sometimes been used by Fed chairs to make important policy statements.
Odds for a rate hike as early as next month mounted following hawkish comments from several Fed officials in recent days, including Fed Vice Chair Stanley Fischer and New York Fed President William Dudley.
According to Investing.com's Fed Rate Monitor Tool, investors are pricing in an 21% chance of a rate hike by September, up from 12% at the start of last week. December odds were at around 50%.
The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced.