Investing.com - Gold prices sank to a four-week low on Thursday, after data showed that the number of Americans filing applications for unemployment benefits dropped to its lowest in nearly half a century.
Spot gold was down $6.08, or around 0.5%, at $1,283.82 per ounce by 8:50AM ET (12:50 GMT), the weakest level since March 7.
Comex gold futures shed $7.55, or about 0.6%, to $1,287.75 a troy ounce.
The yellow metal hit session lows after the U.S. Department of Labor said that initial jobless claims in the week ended March 30 fell unexpectedly by 10,000 to a seasonally-adjusted 202,000.
That was the lowest level since December 1969.
The lack of slack in the labor market ought normally to lead to higher earnings and inflation pressure, leading to higher bond yields. Earnings are rising at their highest pace in a decade but still only at a relatively modest rate.
The market will be able to cross-check that again on Friday when the government releases its monthly employments report.
Meanwhile, talks over a trade deal between the world’s two largest economies may be entering their final stages as negotiations between the U.S. and China continue in Washington.
U.S. President Donald is due to meet with Vice Premier Liu He in the Oval Office at 4:30PM ET (20:30 GMT), according to a White House schedule.
“There is a lot of optimism around the idea that we will see a peaceful resolution and some agreement really soon,” said Michael McCarthy, chief market strategist, CMC Markets.
“However, if the trade talks drag out we could see further support for gold because of its implications on growth,” McCarthy said.
In other metals trading, silver futures sank 15.9 cents, or roughly 1%, to $14.94 a troy ounce.
Elsewhere, palladium futures declined 1.8% to $1,352.45 an ounce, while platinum jumped 2.2% to $893.90 an ounce, its highest since June last year.
-- Reuters contributed to this report