Gold prices slid lower on Friday, as a stronger U.S. dollar weighed but the precious metal still remained within close distance of a three-week highs amid lower expectations for a summer U.S. rate hike.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery declined 0.34% to $1,268.25.
The August contract ended Thursday’s session 0.82% higher at $1,272.70 an ounce.
Futures were likely to find support at $1,158.10, Thursday’s low and resistance at $1,272.30, Thursday’s high and a three-week high.
The U.S. dollar regained some ground after the Department of Labor said on Thursday that the number of individuals filing for initial jobless benefits in the week ending June 4 decreased by 4,000 to 264,000 from the previous week’s revised total of 268,000.
Analysts had expected jobless claims to rise by 3,000 to 270,000 last week.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.13% at a one-week high of 94.20.
But the yellow metal remained supported as markets pushed back expectations on the timing of the next rate hike by the U.S. central bank after last week’s dismal employment report for May, which showed the slowest rate of jobs growth since September 2010.
In addition, a speech by Federal Reserve Chair Janet Yellen on Monday indicated that interest rates won’t rise until uncertainty over the economic outlook is resolved.
Yellen said she expects the economic recovery to continue but gave no indications on the timing of a next rate increase.
Gold is sensitive to moves in U.S. rates, as a rise would lift the opportunity cost of holding non-yielding assets such as bullion.
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.
Elsewhere in metals trading, silver futures for July delivery eased 0.08% to $17.255 a troy ounce, while copper futures for July delivery dropped 0.74% to $2.023 a pound.
Source: Investing.com
