Gold futures edge lower ahead of U.S. data

Investing.com - Gold edged lower on Thursday, as market players looked ahead to the release of key U.S. data later in the session for further indications on the strength of the economy and the future path of monetary policy.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery shed $2.70, or 0.22%, to trade at $1,208.00 a troy ounce during European morning hours, after hitting a session low of $1,205.00.

A day earlier, gold lost $8.70, or 0.71%, to settle at $1,210.70, after data showed that the U.S. private sector added a larger-then-forecast 241,000 jobs in December.

The upbeat data boosted the outlook for the U.S. recovery and raised expectations for a strong reading of the government nonfarm payrolls due on Friday.

Futures were likely to find support at $1,177.80, the low from January 5, and resistance at $1,223.30, the high from January 6.

Also on the Comex, silver futures for March delivery declined 10.6 cents, or 0.64%, to trade at $16.43 a troy ounce.

Later Thursday, the U.S. was to produce its weekly report on initial jobless claims.

Gold lost nearly 2% in 2014 amid indications a strengthening U.S. economic recovery will force the Federal Reserve to start raising interest rates sooner and faster than previously thought.

Wednesday’s minutes of the Fed’s December meeting did little to alter expectations that U.S. interest rates will start to rise later this year.

Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.

Elsewhere in metals trading, copper for March delivery picked up 1.4 cents, or 0.5%, to trade at $2.772 a pound, amid growing expectations that the European Central Bank could implement quantitative easing as soon as its next meeting on January 22.

Meanwhile, oil prices recovered on Thursday to move further away from the lowest level since spring 2009, as investors returned to the market to close out bets on lower prices.

Nymex oil futures tacked on 9 cents, or 0.17%, to $48.74 a barrel, while London-traded Brent prices dipped 7 cents, or 0.14%, to $51.08.

The US dollar index, which measures the greenback against a basket of six major currencies, climbed to a nine-year high, boosted by the diverging policy outlook between the Federal Reserve and central banks in Europe and Japan.