Gold futures ended marginally higher Thursday, on a weak dollar even as the euro surged after the European Central Bank maintained its lending rate unchanged. Investors also weighed some mixed macroeconomic data out of the U.S., while reflecting on ECB President Mario Draghi’s comments on euro area growth.
In economic news from the U.S., initial jobless claims dropped unexpectedly, while productivity dropped more than anticipated and trade deficit in January widened.
The European Central Bank held its key interest rate at 0.75 percent, with President Mario Draghi exuding optimism for a recovery in the recession-hit euro area economy later this year, even as the central bank staff cut their growth projections. Draghi, however, said the central bank will continue to be accommodative in its monetary policy.
Gold for April delivery, the most actively traded contract, gained $0.20 to close at $1,575.10 an ounce Thursday on the Comex division of the New York Mercantile Exchange.Gold for April delivery scaled an intraday high of $1,584.90 and a low of $1,574.40 an ounce.
Yesterday, gold settled flat tracking rising equity markets with some upbeat private jobs data out of the U.S. and a strong dollar. Nonetheless, gold found some support after some soft U.S. factory orders data.
The dollar index, which tracks the U.S. unit against six major currencies, traded at 82.11 on Thursday, down from 82.55 late Wednesday in North American trade. The dollar scaled a high of 82.59 intraday and a low of 81.96.
The euro surged after the ECB maintained its key interest rate unchanged. The euro traded higher against the dollar at $1.3115 on Thursday, as compared to $1.2966 late Wednesday in North America. The euro scaled a high of $1.3116 intraday and a low of $1.2968.
In economic news from the U.S., the Labor Department said initial jobless claims dropped to 340,000 from the previous week’s revised figure of 347,000. Economists expected claims to rise to 355,000 from the 344,000 originally reported for the previous month.
Separately, the Labor department said productivity in the U.S. fell slightly less than previously estimated in the final three months of 2012. The report said productivity fell by 1.9 percent in the fourth quarter compared to the preliminary estimate of a 2.0 percent decrease. Economists expected the size of the drop to be revised to 1.6 percent.
Meanwhile, a report from the U.S. Commerce Department showed trade deficit January widened to $44.4 billion from a revised $38.1 billion in December. Economists expected the deficit to widen to $43.0 billion from the $38.5 billion originally reported for the previous month.
Elsewhere, the Bank of England maintained its quantitative easing at GBP 375 billion and the interest rate at a record low 0.50 percent, as widely expected.
The European Central Bank’s latest projections show growth forecast for 2013 lowered to a range between -0.9 percent and -0.1 percent from -0.9 percent and 0.3 percent projected in December. For 2014, growth is seen between flat and 2 percent, which is lower than the 0.2 percent -2.2 percent seen earlier.
German manufacturing orders decreased unexpectedly in January, as demand in the eurozone weakened amid the deepening debt crisis, a sign that recovery in Europe’s largest economy is losing momentum. New orders received by German manufacturers decreased 1.9 percent in January from a month ago, after adjusting for seasonal variations and inflation, data from the Federal Ministry of Economics and technology showed. Economists expected orders to increase 0.6 percent following the 1.1 percent increase in December.
by RTT Staff Writer
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