Investing.com -- Gold futures remained near five-year lows from the previous session, amid a mixed bag of economic data and relatively hawkish comments from Federal Reserve vice chairman Stanley Fischer on the prospect of rebounding inflation, which strengthened the possibility of a December rate hike from the U.S. Central Bank.
On the Comex division of the New York Mercantile Exchange, gold for December delivery traded in a range between $1,079.00 and $1,088.00 an ounce before settling at $1,080.50, down 0.50 or 0.05% on the session. A day earlier, gold plunged to an intraday low of $1,073.40, en route to its 10th losing session over the previous 12 trading days. The precious metal tumbled to its lowest level since February, 2010, when it traded below $1,065 an ounce. The recent commodity rout among metal futures has exacerbated fears that gold could dip below $1,000, a level not seen since 2009 during the height of the Financial Crisis.
Since surging above $1,185 an ounce in mid-October, gold has plunged by nearly 9% in value.
Gold likely gained support at $1,078.60, the low from July 24 and was met with resistance at $1,189.00, the high from Oct. 14.
On Thursday evening after the close of trading, Fischer reiterated that long-term inflation will move back toward the Fed's long-term goal of 2%, as transitory effects from a strong dollar and low energy prices continue to recede. Earlier this week, the dollar soared to a seven-month high as currency traders reacted to last week's stellar U.S. jobs report from October. Crude futures, meanwhile, slumped to near six-and-a-half year lows in Thursday's session amid further signs of a glut of oversupply on global energy markets. Inflation has remained below the Fed's long-term goal of 2% in every month over the last three years.
In September, the PCE Price Index inched up 0.2% on a yearly basis following a 0.3% gain a month earlier. The Core PCE Price Index, which strips out food and energy prices, rose by 1.3%, unchanged from August. The core index is the Fed's preferred gauge for long-term inflation.
"From the standpoint of the outlook, this transience means that some of the forces holding down inflation in 2015--particularly those due to a stronger dollar and lower energy prices --will begin to fade next year," Fischer said in a speech at the Fed's conference on Monetary Policy Implementation and Transmission in the Post-Crisis. "Consequently, overall PCE inflation is likely on this account alone to rebound next year to around 1-1/2 percent. And as long as inflation expectations remain well anchored, both core and overall inflation are likely to rise gradually toward 2 percent over the medium term as the labor market improves further and the transitory effects of declines in energy and import prices dissipate."
A rate hike is viewed as bearish for gold, which struggles to compete with high yield bearing assets.
Elsewhere, U.S. retail sales in October ticked up by 0.1%, two-tenths under consensus estimates due in part to sharp declines in electronic & appliance purchases and grocery sales. Core sales, minus auto and gas prices, increased by 0.3% after a flat reading in September. Producer prices, meanwhile, tumbled 0.3%, amid continued declines in the services industry. Business inventories, however, rose by a stronger than expected 0.3% last month.
The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, stood at 99.25 in U.S. afternoon trading, up 0.69% on the session. The index approached near seven-month highs from Monday's session. Dollar-denominated commodities such as gold become more expensive for foreign purchasers when the dollar appreciates.
Silver for December delivery lost 0.035 or 0.25% to close at 14.190 an ounce.
Copper for December delivery fell to a fresh six-year low at 2.151 a pound, before rebounding to 2.167 -- down 0.005 or 0.26% on the day.