Gold Ends Above $1,300 On Weak U.S. Data

(RTTNews) - Gold futures moved up for a seventh straight day to end higher on Thursday, after some soft macroeconomic data out of the U.S. with retail sales dropping in January and initial claims for unemployment benefits increasing more than expected. The precious metal found support with the dollar weakening against a basket of major currencies, making gold attractive to buyers holding other currencies.

In economic news, U.S. retail sales in January dropped unexpectedly with auto sales showing another notable decrease, a Commerce Department report indicated Thursday. Meanwhile, business inventories in the U.S. rose slightly more than expected in December, according to a Commerce Department report on Thursday.

Gold for April delivery, the most actively traded contract, gained $5.10 or 0.4 percent to close at $1,300.10 an ounce on the Comex division of the New York Mercantile Exchange on Thursday.

Gold for April delivery scaled an intraday high of $1,300.60 and a low of $1,286.20 an ounce.

Yesterday, gold ended higher on some upbeat trade data from China even as investors continued to cheer the U.S. Federal Reserve Chairman Janet Yellen comments on the economy.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged up to 798.85 from 797.05 tons.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.33 on Thursday, down from its previous close of 80.70 late Wednesday in North American trade. The dollar scaled a high of 80.71 intraday and a low of 80.19.

The euro traded higher against the dollar at $1.3671 on Thursday, as compared to its previous close of $1.3594 late Wednesday in North America. The euro scaled a high of $1.3691 intraday and a low of $1.3586.

In economic news, U.S. retail sales in January 0.4 percent following a revised 0.1 percent decrease in December. Economists expected sales to come in unchanged compared to the 0.2 percent increase originally reported for the previous month. The unexpected drop in retail sales largely reflects a 2.1 percent decrease in sales by motor vehicle and parts dealers, which fell by 1.8 percent in December.

Business inventories in the U.S. rose 0.5 percent in December following a 0.4 percent increase in November. Economists expected inventories to rise by another 0.4 percent.

A report from the Labor Department on Thursday showed first-time claims for U.S. unemployment benefits unexpectedly showed a modest increase in the week ended February 8th. Initial jobless claims rose to 339,000, an increase of 8,000 from the previous week's unrevised figure of 331,000. Economists expected initial jobless claims to edge down to 330,000.