Investing.com - A soft report on weekly jobless claims and cautious statements from Federal Reserve Chair Janet Yellen weakened the dollar and sent gold prices posting cautious gains on Thursday.
Gold and the dollar tend to trade inversely with one another.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at $1,328.50 a troy ounce during U.S. trading, up 0.04%, up from a session low of $1,324.20 and off a high of $1,336.40.
The April contract settled down 1.09% at $1,328.00 on Wednesday.
Futures were likely to find support at $1,322.80 a troy ounce, Wednesday's low, and resistance at $1,345.50, Wednesday's high.
Recent manufacturing, jobs and other economic indicators have disappointed markets, leaving investors unclear if recovery has hit a soft patch or if a string of winter storms has put commerce temporarily on hold.
Speaking before the Senate banking committee, Yellen told lawmakers it was hard to say how much the recent soft data was due to rough winter weather and added that the bank would remain attentive to signals on whether the recovery is progressing in line with expectations.
Her comments softened the dollar by clouding expectations as to how slowly the Fed will taper its monthly bond-buying program, which weakens the greenback by suppressing long-term interest rates to spur recovery, thus making gold an attractive hedge.
Also softening the dollar, weekly data revealed that the number of individuals filing for unemployment assistance in the U.S. last week rose more than expected.
The Labor Department said the number of people filing for initial jobless benefits rose by 14,000 to 348,000 from the previous week’s total of 334,000. Analysts had expected an increase of just 1,000, and the numbers rekindled expectations for a very gradual tapering of Fed asset purchases.
Also on Thursday, the Commerce Department reported that U.S. durable goods orders declined by a seasonally adjusted 1% last month, less than expectations for a 1.5% drop.
Core durable goods orders, excluding volatile transportation items, rose 1.1% in January, the largest increase since May, confounding forecasts for a 0.3% decline, which gave the dollar some support and capped gold's gains.
Meanwhile, silver for May delivery was down 0.17% and trading at US$21.252 a troy ounce, while copper futures for May delivery were down 0.41% at US$3.202 a pound.