Breaking News

Gold holds gains after U.S. jobless claims data; Fed minutes support

CommoditiesAug 23, 2012 09:08AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
Investing.com - Gold futures held on to gains during U.S. morning hours on Thursday, trading at the highest level since early May after official data showed that the number of people who filed for unemployment assistance in the U.S. last week rose slightly.

The precious metal continued to draw strong support from Wednesday’s minutes of the Federal Reserve’s August meeting, which indicated that the central bank may be close to implementing a third round of easing measures.

On the Comex division of the New York Mercantile Exchange, gold futures for October delivery traded at USD1,663.95 a troy ounce during U.S. morning trade, rallying 1.6%.      

Earlier in the day, prices rose by as much as 1.75% to hit a session high of USD1,667.05 a troy ounce, the highest since May 1.

Gold futures were likely to find support at USD1,610.25 a troy ounce, the low from August 20 and near-term resistance at USD1,672.15, the high from May 1.

The U.S. Department of Labor said the number of people filing for initial jobless benefits last week rose by 4,000 to a seasonally adjusted 372,000, compared to expectations for a decline of 3,000 to 365,000.

The previous week’s figure was revised up to 368,000 from a previously reported 366,000.

The data came after Wednesday’s minutes of the Federal Reserve’s August meeting showed that many policymakers think additional easing may be warranted "fairly soon" unless there is evidence of a "substantial and sustainable" strengthening in the economic recovery.

Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would pump more money into the financial system.

Gold gained as much as 15% earlier this year to hit USD1,790 an ounce after the Fed said in January it would keep interest rates near zero until at least late 2014 and indicated that it could introduce a fresh round of asset-purchases.

However, prices have lost almost 7% since late February, as the Fed failed to deliver more easing and amid concerns over the euro zone’s deepening debt crisis, which has fueled demand for the precious metal's hedge, the greenback.

Prices found further support after disappointing Chinese manufacturing data released earlier added to hopes policymakers in Beijing will introduce fresh stimulus measures to boost growth in the world’s second largest economy.

Data released earlier in the day showed that China’s HSBC Flash Purchasing Managers Index fell to a nine-month low of 47.8 in August from a final reading of 49.3 in July, as new orders slumped in the face of weakening global demand.

From a technical standpoint, the precious metal has further room to march higher after prices settled above their 200-day moving average close to the USD1,640-level on Wednesday, indicating bullish chart signals.

Elsewhere on the Comex, silver for September delivery rallied 2.9% to trade at USD30.40 a troy ounce, the highest since May 3, while copper for September delivery jumped 1.4% to trade at a one-month high of USD3.502 a pound.

Gold holds gains after U.S. jobless claims data; Fed minutes support

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Are you sure you want to delete this chart?
Write your thoughts here
Replace the attached chart with a new chart ?
Post also to:
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Post 1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email