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Gold prices slip as U.S. dollar moves higher

Published 05/12/2016, 02:59 AM
© Reuters.  Gold moves lower on stronger greenback

Investing.com - Gold prices slipped on Friday, as the U.S. dollar moved moderately higher ahead of the release of U.S. jobless claims data due later in the day.

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery were down 0.28% at $1,271.95.

The June contract ended Wednesday’s session 0.85% higher at $1,275.50 an ounce.

Futures were likely to find support at $1,266.90, the low from May 10 and resistance at $1,286.50, the high from May 9.

The dollar regained some ground, especially against the yen after Japanese Finance Minister Taro Aso said on Monday that financial authorities are prepared to intervene in the currency market if excessive moves in the yen are enough to affect the country’s economy.

However, Bank of Japan Governor Haruhiko Kuroda said earlier Thursday that it would be difficult for Japan's finance ministry to intentionally weaken the yen to boost exports.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.11% at 93.90.

Prices of the yellow metal are up nearly 19% so far this year amid indications the Federal Reserve will take a slow and cautious approach to raising interest rates this year.

Gold is sensitive to moves in U.S. rates, as a rise would lift the opportunity cost of holding non-yielding assets such as bullion. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.

Elsewhere in metals trading, silver futures for July delivery were steady at $17.320 a troy ounce, while copper futures for July delivery jumped 0.97% to $2.124 a pound.

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