Gold hits session lows after upbeat ADP data

Investing.com - Gold futures fell to the lowest levels of the session on Wednesday, after data showed that U.S. non-farm private employment rose more-than-expected in December.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery shed $7.50, or 0.62%, to trade at $1,211.90 a troy ounce during U.S. morning hours. Futures traded in a range between $1,209.20 and $1,219.40.

A day earlier, gold hit $1,223.30, the most since December 16, before settling at $1,219.40, up $15.40, or 1.28%, as safe-haven demand was boosted amid growing fears that Greece might exit the euro zone.

Futures were likely to find support at $1,177.80, the low from January 5, and resistance at $1,225.00, the high from December 15.

Also on the Comex, silver futures for March delivery declined 26.4 cents, or 1.59%, to trade at $16.37 a troy ounce.

Payroll processing firm ADP said non-farm private employment rose by a seasonally adjusted 241,000 last month, above expectations for an increase of 226,000.

The economy created 227,000 jobs in November, whose figure was upwardly revised from a previously reported 208,000.

While not viewed as a reliable guide for the government jobs report due on Friday, January 9, it does give guidance on private-sector hiring.

Investors now looked ahead to the minutes of the Federal Reserve’s December meeting, due out later in the day, which were expected to provide further indications on the future direction of monetary policy.

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

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 inched up 0.1 cents, or 0.05%, to trade at $2.768 a pound.

Meanwhile, oil prices recovered after falling to the lowest level since spring 2009 earlier in the session, as investors returned to the market to close out bets on lower prices.

London-traded Brent prices rose 1 cent, or 0.03%, to $51.12, after hitting a low of $49.70 earlier, while Nymex oil futures picked up 42 cents, or 0.89%, to $48.36, after dropping to $46.85.

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.