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Gold falls to session low after U.S. data; Non-farm jobs report in focus

Published 01/31/2013, 09:11 AM
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Investing.com - Gold futures eased down during U.S. morning hours on Thursday, falling to the lowest levels of the session following the release of a flurry of U.S. economic data.

Losses were limited after the Federal Reserve kept its ultra-loose monetary policy intact at the outcome of its latest policy meeting on Wednesday.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,672.15 a troy ounce during U.S. morning trade, down 0.55% on the day.

Prices fell by as much as 0.6% earlier in the day to hit a session low of USD1,671.55 a troy ounce. Gold futures rose to USD1,684.35 a troy ounce on Wednesday, the strongest level since January 24, which led to some profit-taking.

Gold prices were likely to find support at USD1,653.35 a troy ounce, the low from January 28 and near-term resistance at USD1,685.35, the high from January 24.

The Department of Labor said the number of individuals filing for initial jobless benefits last week rose by 38,000 to a seasonally adjusted 368,000, compared to expectations for an increase of 20,000 to 350,000.

A separate report showed that personal incomes in the U.S. jumped 2.6% in December, the largest increase in eight years, while personal spending rose 0.2%, below expectations for a 0.3% increase.

The data came one day after the Federal Reserve said it would continue to pursue its easing program and reiterated that it would hold interest rates close to zero until the U.S. unemployment rate falls below 6.5%.

The Fed’s quantitative easing program is viewed by many investors as a major source of liquidity that weakens the U.S. dollar and helps support prices of commodities and other hard assets, including gold.

With the Fed meeting behind them, gold traders will now turn their attention to Friday's nonfarm employment report.

Elsewhere on the Comex, silver for March delivery fell 0.85% to trade at USD31.90 a troy ounce, while copper for March delivery was flat to trade at USD3.751 a pound.

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