Investing.com - Gold extended losses from the previous session on Thursday, as traders reassessed their expectations for the timing of the first U.S. rate hike after the Federal Reserve sounded more upbeat about the economy.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery dipped $6.60, or 0.51%, to trade at $1,280.60 a troy ounce during European morning hours.
Prices held in a range between $1,278.30 and $1,286.50. A day earlier, gold lost $5.70, or 0.44%, to settle at $1,287.20.
Futures were likely to find support at $1,273.00, the low from January 27, and resistance at $1,300.20, the high from January 26.
Also on the Comex, silver futures for March delivery declined 27.5 cents, or 1.52%, to trade at $17.81 a troy ounce. On Wednesday, silver eased up 0.4 cents, or 0.02%, to end at $18.08.
Following its policy meeting on Wednesday, the Fed said it would keep rates on hold at least until June and reiterated its pledge to be "patient" on raising interest rates, while acknowledging the solid economic recovery and strong growth in the labor market.
The central bank also said it expected inflation to keep declining in the short term and added that it would take "financial and international developments" into account before deciding when to hike borrowing costs.
Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.1% to 94.98, holding below last Friday’s more than 11-year highs of 95.77.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Later in the day, the U.S. was to publish the weekly report on initial jobless claims as well as private sector data on pending home sales. On Friday, the U.S. will release preliminary data on fourth quarter growth, which is expected to show expansion of 3.0%.
Elsewhere in metals trading, copper for March delivery shed 3.6 cents, or 1.44%, to trade at $2.444 a pound. The March contract hit a five-year low of $2.419 on Monday.
The red metal is down approximately 11.5% so far in January as concerns over the global economic outlook and the impact on future demand prospects dampened the appeal of the commodity.
Meanwhile, the euro remained under pressure after Greece’s new government moved Wednesday to roll back deeply unpopular austerity policies underpinning the county’s €240 billion international bailout, fuelling fears over a clash with its international creditors.
In the oil market, crude prices traded near the lowest level in six years after government data showed U.S. crude supplies rose to the highest level since at least 1982.
Nymex oil futures lost 14 cents, or 0.33%, to $44.31 a barrel, while London-traded Brent prices dipped 4 cents, or 0.08%, to $48.43.