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Gold futures trim losses on U.S. data, Greece debt fears

Published 06/16/2011, 10:44 AM
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Investing.com – Gold futures pared losses on Thursday, easing off the daily low as risk aversion eased after stronger than-expected U.S. economic data on first time jobless claims and housing starts.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at USD1,529.25 a troy ounce during U.S. morning trade, edging 0.14% lower.              

It earlier fell to a daily low of USD1,522.35 a troy ounce.

Earlier in the day, the Commerce Department said housing starts rose 3.5% to a seasonally adjusted annual rate of 560,000 units in May, outstripping expectations for an increase to 550,000.

In a separate report, the Labor Department said the number of people filing for initial jobless benefits last week fell to a seasonally adjusted 414K, surpassing expectations for a decline to 420K.

Meanwhile, fears over Greece’s debt woes were exacerbated after the ruling Socialist Party said it was convening an emergency meeting of its lawmakers, following a string of parliamentary resignations over the past 24 hours.

The meeting, scheduled to take place later in the day, was likely to delay an expected cabinet reshuffling by Prime Minister George Papandreou, adding to investors’ nervousness over the country’s debt crisis.

The cost of insuring the country’s sovereign debt against default jumped to a euro lifetime high. Portuguese and Irish borrowing costs also hit record highs, stoking fears of contagion.

Meanwhile, the greenback retreated from a three-week high against the euro, while the dollar index eased off a four-week high, boosting the appeal of the precious metal.

Elsewhere, silver for July delivery fell 1.2% to trade at USD35.34 a troy ounce during U.S. morning trade.

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