Gold prices steady in Asia with physical demand eyed

Investing.com - Gold prices held steady to weaker in Asia on Friday with markets in Tokyo trading light ahead of a three-day weekend, though investors are still looking for physical demand support ahead of the year-end holidays.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at $1,193.00 a troy ounce, down 0.04%, after hitting an overnight session low of $1,176.30 and off a high of $1,196.60. Japan has a publi holiday on Monday.

Overnight, Gold prices edged lower in U.S. trading on Thursday after a batch of upbeat U.S. indicators sent investors flocking to the dollar, which trades inversely with the yellow metal.

Manufacturing activity in the Philadelphia-region expanded at its fastest rate since December 1993 in November, fueling optimism over the U.S. economic outlook, official data showed on Thursday.

The Federal Reserve Bank of Philadelphia reported earlier that its manufacturing index improved to 40.8 this month from 20.7 in October.

Analysts had expected the index to decline to 18.5 in September, and the surprise jump strengthened the U.S. currency and gave gold room to fall, though physical demand cushioned losses.

The current new orders index, which reflects the demand for manufactured goods, increased 18 points, to 35.7.

The current employment index rose 10 points in November, to 22.4, and hit a 3½ year high.

Upbeat U.S. inflation data also boosted the dollar by firming expectations that the Fed remains on track to raise interest rates next year.

The Labor Department reported earlier that the U.S. consumer price index was unchanged in October, beating expectations for a 0.1% dip.

On a year-over-year basis consumer prices rose 1.7% last month, unchanged from September, and stronger than market calls for a 1.6% jump.

Core inflation, which strips out volatile food and energy components, rose by 0.2% during the month, pushing the annual rate up to 1.8%, both figures in line with market forecasts, which also fueled dollar demand.

Also from the Labor Department, data released earlier revealed that the number of Americans filing new claims for unemployment benefit fell by 2,000 last week, to 291,000. Economists had expected a fall to 286,000, thought it was still the tenth straight week that initial claims remained below 300,000.

The number of continuing claims also fell, to 2.33 million, the lowest level since December 2000.

Silver futures for December delivery fell 0.04% at $16.223 a troy ounce. Copper futures for December delivery were up 0.09% at $3.019 a pound.