Investing.com - Gold futures remained sharply lower during U.S. morning hours on Thursday, trading below the key psychological USD1,700-level following the release of mixed data on U.S. retail sales and jobless claims.
Gold futures came under additional pressure from a bout of technical selling and profit taking following the latest easing moves from the Federal Reserve.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,695.05 a troy ounce during U.S. morning trade, down 1.3% on the day.
Prices fell by as much as 1.5% earlier in the day to trade at a daily low of USD1,692.25 a troy ounce, the weakest level since December 7.
Gold’s losses accelerated after prices broke below key support levels close to the USD1,705-level, triggering fresh sell orders amid bearish chart signals.
Gold futures were likely to find near-term support at USD1,685.75 a troy ounce, the low from December 7 and resistance at USD1,724.75, the previous session’s high.
The Department of Labor said the number of people filing for initial jobless benefits fell by 29,000 to 343,000 last week, against expectations for a decline of 2,000. The previous week’s figure was revised up to 372,000 from a previously reported 370,000.
Separately, the Commerce Department said retail sales rose 0.3% in November, missing expectations for a 0.5% increase, while core retail sales, which exclude automobile sales, were flat for the second consecutive month last month.
Meanwhile, official data showed that producer price inflation in the U.S. fell 0.8% last month, compared to forecasts for a 0.5% decline. The core producer price index eased up 0.1% last month, after falling 0.2% in October.
Core prices are viewed by the Federal Reserve as a better gauge of longer-term inflationary pressure because they exclude the volatile food and energy categories.
The U.S. central bank said Wednesday that it would continue to purchase USD85 billion a month of government bonds and mortgage based securities in order to shore up the economic recovery.
The Fed also said that interest rates would remain close to zero as long as inflation forecasts remain near the bank’s 2% target and until the U.S. unemployment rate declines to 6.5% or less.
Investors continued to monitor developments surrounding the fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1, unless a divided Congress and the White House can work out a compromise in the two weeks left before the deadline.
House of Representatives Speaker John Boehner said Wednesday "serious differences" remain with President Barack Obama on the budget talks, while Fed Chairman Ben Bernanke warned that the central bank does not have the ability to “offset the full impact of the fiscal cliff”.
President Obama said recently that any solution must include spending cuts and raising revenue, including increasing taxes on the wealthiest. Republican leaders say they will agree to higher revenue, but they want to close loopholes or reduce tax breaks rather than raise rates.
Meanwhile, in the euro zone, finance ministers agreed a deal on rules for supervising the bloc’s banks ahead of a European Union summit later in the day.
Ministers also released EUR49.1 billion of financial aid for Greece, after the country completed a scheme to buy back its debt from private investors this week.
Elsewhere on the Comex, silver for March delivery plunged 3% to trade at USD32.74 a troy ounce, while copper for March delivery fell 1.3% to trade at USD3.667 a pound.
Gold futures came under additional pressure from a bout of technical selling and profit taking following the latest easing moves from the Federal Reserve.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,695.05 a troy ounce during U.S. morning trade, down 1.3% on the day.
Prices fell by as much as 1.5% earlier in the day to trade at a daily low of USD1,692.25 a troy ounce, the weakest level since December 7.
Gold’s losses accelerated after prices broke below key support levels close to the USD1,705-level, triggering fresh sell orders amid bearish chart signals.
Gold futures were likely to find near-term support at USD1,685.75 a troy ounce, the low from December 7 and resistance at USD1,724.75, the previous session’s high.
The Department of Labor said the number of people filing for initial jobless benefits fell by 29,000 to 343,000 last week, against expectations for a decline of 2,000. The previous week’s figure was revised up to 372,000 from a previously reported 370,000.
Separately, the Commerce Department said retail sales rose 0.3% in November, missing expectations for a 0.5% increase, while core retail sales, which exclude automobile sales, were flat for the second consecutive month last month.
Meanwhile, official data showed that producer price inflation in the U.S. fell 0.8% last month, compared to forecasts for a 0.5% decline. The core producer price index eased up 0.1% last month, after falling 0.2% in October.
Core prices are viewed by the Federal Reserve as a better gauge of longer-term inflationary pressure because they exclude the volatile food and energy categories.
The U.S. central bank said Wednesday that it would continue to purchase USD85 billion a month of government bonds and mortgage based securities in order to shore up the economic recovery.
The Fed also said that interest rates would remain close to zero as long as inflation forecasts remain near the bank’s 2% target and until the U.S. unemployment rate declines to 6.5% or less.
Investors continued to monitor developments surrounding the fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1, unless a divided Congress and the White House can work out a compromise in the two weeks left before the deadline.
House of Representatives Speaker John Boehner said Wednesday "serious differences" remain with President Barack Obama on the budget talks, while Fed Chairman Ben Bernanke warned that the central bank does not have the ability to “offset the full impact of the fiscal cliff”.
President Obama said recently that any solution must include spending cuts and raising revenue, including increasing taxes on the wealthiest. Republican leaders say they will agree to higher revenue, but they want to close loopholes or reduce tax breaks rather than raise rates.
Meanwhile, in the euro zone, finance ministers agreed a deal on rules for supervising the bloc’s banks ahead of a European Union summit later in the day.
Ministers also released EUR49.1 billion of financial aid for Greece, after the country completed a scheme to buy back its debt from private investors this week.
Elsewhere on the Comex, silver for March delivery plunged 3% to trade at USD32.74 a troy ounce, while copper for March delivery fell 1.3% to trade at USD3.667 a pound.