Investing.com - Gold prices eased slightly in Asia on Thursday as investors booked profits, though the yellow metal remained well supported on geopolitical concerns over the Ukraine.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at $1,301.50 a troy ounce, down 0.15%, after hitting an overnight session low of $1,293.80 and off a high of $1,307.00.
Overnight, gold prices rose after Federal Reserve Chair Janet Yellen said ideal employment and inflation conditions are over two years away, while a mixed bag of U.S. data also bolstered gold's appeal as a hedge to loose monetary policies.
The Federal Reserve will keep benchmark interest rates low even as the economy improves to ensure sustained recovery, with ideal conditions not seen for another two years, Yellen said earlier.
Monetary authorities hope to see the unemployment rate at the end of 2016 reaching 5.2-5.6% and inflation at 1.7-2%, Yellen said.
"If this forecast was to become reality, the economy would be approaching what my colleagues and I view as maximum employment and price stability for the first time in nearly a decade. I find this baseline outlook quite plausible," Yellen said in prepared remarks in a speech she delivered at the Economic Club of New York.
Loose monetary policies tend to weaken the dollar, making gold an attractive hedge.
In the meantime, markets should pay close attention to inflation and unemployment rates, as hiccups can serve as weather vanes when it comes to monetary policy and how long interest rates remain low.
"The larger the shortfall of employment or inflation from their respective objectives, and the slower the projected progress toward those objectives, the longer the current target range for the federal funds rate is likely to be maintained," Yellen said.
Hit-or-miss data softened the dollar and bolstered gold as well.
U.S. industrial production rose 0.7% in March from February, beating expectations for a 0.5% reading, which supported the dollar earlier, though soft U.S. housing data watered down the greenback.
The Commerce Department reported earlier that housing starts rose 2.8% in March to 946,000, missing analyst forecasts for a 6.4% increase to 973,000 units.
Separately, building permits, an indicator of future demand for housing, fell 2.4% in March to 990,000, defying market expectations for a 0.6% increase.
Silver for May delivery was down 0.45% at US$19.545 a troy ounce, while copper futures for May delivery were up 0.22% at US$3.036 a pound.