Gold Ends Higher On Soft U.S. Data, Weak Dollar

(RTTNews) - Gold futures ended higher on Thursday, after the dollar turned lower on some disappointing economic data from the U.S. with initial claims for unemployment benefits rising more than expected last week.

In some disappointing economic news from the U.S., first-time claims for unemployment benefits rose more than anticipated to a six-week high in the week ended November 8, a report from the Labor Department showed Thursday.

In some more soft economic data from China, industrial production and retail sales growth slowed unexpectedly in October, while fixed investment grew less-than-expected, data from the National Bureau of Statistics showed Thursday.

Nevertheless, concerns over imminent U.S. interest rates and slowing demand also weighed down the precious metal, with markets looking out for further cues after comments from the New York Federal Reserve President William Dudley on Thursday.

Dudley said the Federal Reserve should delay raising interest rates until U.S. inflation rises to healthier levels. Addressing the Central Bank of the United Arab Emirates in Abu Dhabi, Dudley said while the unemployment rate has dropped below the Fed's target 6 percent, it is "still premature" to announce a shift toward tighter monetary policy. He said a reasonable outlook for the first interest rate hike would be around mid-2015 "if all goes well."

Meanwhile, physical demand for gold also withered after a World Global Council report showed global gold demand to have declined 2.5 percent to 929.3 metric tons in the third quarter, the lowest in nearly 5 years, even as demand from India more than doubled during the period.

Gold for December delivery, the most actively traded contract, gained $2.40 or 0.2 percent to settle at $1,161.50 an ounce on the Comex division of the New York Mercantile Exchange on Thursday.

Gold for December delivery scaled an intraday high of $1,167.40 and a low of $1,153.00 an ounce.

On Wednesday, gold futures ended lower by $3.90 or 0.3 percent at $1,159.10 an ounce, as the dollar trended higher against some major currencies amid growing speculation about U.S. interest rate hikes happening sooner than earlier anticipated.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged down to 722.67 tons on Thursday from its previous close of 724.46 tons on Wednesday.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 87.82 on Thursday, down from its previous close of 87.84 late Wednesday in North American trade. The dollar scaled a high of 87.88 intraday and a low of 87.62.

The euro trended higher against the dollar at $1.2475 on Thursday, as compared to its previous close of $1.2438 late Wednesday in North American trade. The euro scaled a high of $1.2490 intraday and a low of $1.2428.

In economic news, first-time claims for U.S. unemployment benefits for the week ended November 8, climbed to 290,000, an increase of 12,000 from the previous week's unrevised level of 278,000. Economists expected claims to move up to 280,000. Jobless claims was at its highest level since hitting 295,000 in the week ended September 20.

China's industrial production and retail sales growth slowed unexpectedly in October, while fixed investment grew less-than-expected, data from the National Bureau of Statistics showed Thursday. Industrial production rose 7.7 percent year-over-year in October following the 8 percent growth in September. Economists expected production to rise at the stable rate of 8 percent.

Fixed asset investment grew at its slowest pace since 2001, rising 15.9 percent in the January-October period.

In news from the eurozone, results of the latest survey of Professional Forecasters published in the ECB's monthly bulletin showed that the inflation outlook for next year was slashed to 1 percent from 1.2 percent seen earlier. The projection for this year was lowered to 0.5 percent from 0.7 percent. The growth forecast for next year has been reduced to 1.2 percent from 1.5 percent earlier, and the outlook for this year has been cut to 0.8 percent from 1 percent.