Investing.com - Gold futures edged higher on Thursday, but remained close to the lowest level since mid-January as the release of a flurry of mostly upbeat U.S. data reinforced the view that the U.S. economic recovery is gaining traction, further dampening expectations for a third round of U.S. monetary easing by the Federal Reserve.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,647.85 a troy ounce during U.S. morning trade, edging up 0.3%.
It earlier rose by as much as 0.4% to trade at a session high of USD1,651.55 a troy ounce. Prices plunged nearly 2% to hit USD1634.75 on Wednesday, the lowest since January 16.
Gold futures were likely to find support at USD1,625.85 a troy ounce, the low from January 13 and resistance at USD1,682.75, the previous day’s high.
Gold’s modest gains came as the previous day’s steep drop to an eight-week low created bargain buying opportunities for investors reluctant to bet that prices would fall further.
Gold prices have lost nearly 5% in the three sessions leading up to Thursday, as traders and large institutional investors unwound long positions after the Fed gave an upbeat assessment of the U.S. economy on Tuesday, which reduced expectations for a third round of U.S. monetary easing by the central bank.
A reduced likelihood of additional monetary stimulus can be viewed as a negative for gold, as the metal is seen as a safe store of value and benefits when inflationary fears rise.
Data released Thursday pointed to further evidence of an improving U.S. economy. The U.S. Department of Labor said earlier that the number of individuals filing for initial jobless benefits in the U.S. last week fell to 351,000, matching a four-year low.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 18 of the past 20 weeks.
A separate report showed that manufacturing conditions in New York improved to a 21-month high in March, while manufacturing activity in Philadelphia rose to an 11-month peak.
Also Thursday, government data showed that showed that U.S. producer price inflation rose slightly less-than-expected, while core producer prices rose at an annualized rate of 3.0% last month, unchanged from the previous month.
The data underlined the view that the U.S. economic recovery is gathering momentum, after the Federal Reserve upgraded its outlook on the economy earlier this week.
Meanwhile, global financial service provider Commerzbank said in a report earlier that gold prices could drop even further in the near-term, as prices drop below key support levels.
“As the price falls below important support levels, we may see further selling on the part of money managers. We regard this development as positive for the gold price in the medium term, because the exit of ‘weak hands’ paves the way for the next price rise,” the bank said.
Elsewhere on the Comex, silver for May delivery rose 0.4% to trade at USD32.31 a troy ounce, while copper for May delivery jumped 1.05% to trade at USD3.889 a pound.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,647.85 a troy ounce during U.S. morning trade, edging up 0.3%.
It earlier rose by as much as 0.4% to trade at a session high of USD1,651.55 a troy ounce. Prices plunged nearly 2% to hit USD1634.75 on Wednesday, the lowest since January 16.
Gold futures were likely to find support at USD1,625.85 a troy ounce, the low from January 13 and resistance at USD1,682.75, the previous day’s high.
Gold’s modest gains came as the previous day’s steep drop to an eight-week low created bargain buying opportunities for investors reluctant to bet that prices would fall further.
Gold prices have lost nearly 5% in the three sessions leading up to Thursday, as traders and large institutional investors unwound long positions after the Fed gave an upbeat assessment of the U.S. economy on Tuesday, which reduced expectations for a third round of U.S. monetary easing by the central bank.
A reduced likelihood of additional monetary stimulus can be viewed as a negative for gold, as the metal is seen as a safe store of value and benefits when inflationary fears rise.
Data released Thursday pointed to further evidence of an improving U.S. economy. The U.S. Department of Labor said earlier that the number of individuals filing for initial jobless benefits in the U.S. last week fell to 351,000, matching a four-year low.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 18 of the past 20 weeks.
A separate report showed that manufacturing conditions in New York improved to a 21-month high in March, while manufacturing activity in Philadelphia rose to an 11-month peak.
Also Thursday, government data showed that showed that U.S. producer price inflation rose slightly less-than-expected, while core producer prices rose at an annualized rate of 3.0% last month, unchanged from the previous month.
The data underlined the view that the U.S. economic recovery is gathering momentum, after the Federal Reserve upgraded its outlook on the economy earlier this week.
Meanwhile, global financial service provider Commerzbank said in a report earlier that gold prices could drop even further in the near-term, as prices drop below key support levels.
“As the price falls below important support levels, we may see further selling on the part of money managers. We regard this development as positive for the gold price in the medium term, because the exit of ‘weak hands’ paves the way for the next price rise,” the bank said.
Elsewhere on the Comex, silver for May delivery rose 0.4% to trade at USD32.31 a troy ounce, while copper for May delivery jumped 1.05% to trade at USD3.889 a pound.