Investing.com - Gold futures were slightly lower in North American trade on Thursday, pulling back from a three-week high hit overnight, after data showed that the number of people who filed for unemployment assistance in the U.S. last week fell unexpectedly.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits fell by 4,000 to 264,000 last week. Analysts expected jobless claims to rise by 2,000 to 270,000 from the previous week’s 268,000.
Meanwhile, the U.S. dollar pushed higher on Thursday, after falling to five-week lows against a basket of currencies in the prior session amid diminished expectations for a Federal Reserve summer rate hike.
The dollar index rose 0.3% to 93.87 after dropping to 93.41 on Wednesday, a level not seen since May 6.
Gold for August delivery on the Comex division of the New York Mercantile Exchange rallied to a daily peak of $1,269.00 a troy ounce, the most since May 18. It last traded at $1,261.10 by 12:37GMT, or 8:37AM ET, down $1.20, or 0.1%.
On Wednesday, gold surged $15.30, or 1.23%, amid waning expectations that the Fed will raise interest rates anytime soon.
Investors all but ruled out a rate hike at the Fed’s June 14-15 meeting after U.S. employment data last week showed the economy added just 38,000 jobs last month, the smallest increase since September 2010.
Market players are pricing in just a 4% chance for a rate hike later this month and 27% for July, according to CME Group's (NASDAQ:CME) FedWatch tool. September odds were at about 44%.
Federal Reserve Chair Janet Yellen said earlier this week that the central bank plans to raise interest rate hikes, but gave no indication on the timing of the rate hikes.
Prices of the precious metal are up nearly 4% so far in June, after sliding more than 6% a month earlier, as market players reacted to shifting views on the timing of the next U.S. rate hike.
Gold is up 19% so far this year amid skepticism over the Federal Reserve's ability to raise interest rates as much as it would like this year.
The yellow metal is sensitive to moves in U.S. interest rates. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
Elsewhere on the Comex, silver futures for July delivery tacked on 3.0 cents, or 0.18%, to trade at $17.01 a troy ounce during morning hours in New York, while copper futures dropped 3.8 cents, or 1.87%, to $2.023 a pound.
Investors digested another round of Chinese economic data. The National Bureau of Statistics reported earlier that China’s consumer price index rose 2.0% in May from a year earlier, below forecasts for an increase of 2.3%. The producer price index fell 2.8% on a year-over-year basis, compared to a decline of 3.4% in April, the agency said.
The Asian nation is the world’s largest copper consumer, accounting for nearly 45% of world consumption.